Economic Change

1. Economic Change 1919 to 1941

2. Early Presidents • Calvin Coolidge • Pro Business • High Tariffs on Imports • Causes Americans to buy American

3. Early Presidents • Herbert Hoover • Low Taxes • Business profit up which creates expansion

4. New Inventions and Economy • Automobile and Electricity • How does the creation of the Automobile and houses with Electricity effect the economy?

5. Post World War I • Automobile • Paved Roads • Gasoline Stations • Repair Shops • Motels

6. Electric Power and Appliances • Electricity wired in most of American homes by 1920 • Appliances • Refrigerators • Cooking Ranges • Toasters

7. Real Wages • Refers to wages adjusted for inflation. • As prices rose so did incomes. • Minimum Wage • 1938 = $0.25 Coach Goodwin in Jr. High • 1995 = $4.25 Coach Franz in Jr. High • 2013 = $7.25 Insert joke for Coach Treynor.

8. 1900 Wringer and washboard=$5 Brushes and Brooms=$5 Sewing Machine(mechanical)=$25 1928 Washing Machine=$150 Vacuum=$50 Sewing Machine (electrical)=$60 Goods and Prices

9. Psychology

10. Advertising • Psychologist studies shopping habits • Led to slogans • Songs • Finish the Sentence • Just Do________

11. Debt • Installment Plan • Buy goods over an extended period, without having to put down much money at the time of purchase. • Ex. – Rent A Center • Credit • Times good • People live beyond means • Buy now and pay later.

12. Speculation • Buying stocks and hoping for a quick profit • Buy stock at a low price • When value of stock goes up you sell • Form of Gambling

13. Buying on the Margin • Pay a small price for stock • Borrow to pay for rest of stock • Large amount of stock being bought

14. Too Many Goods, Too Little Demand • More products for sale then people wanting to buy product. • Company loses money. • Business start to fail.

15. Black Thursday • September • Stocks peak and fall • People get scared start to sale • October 24, 1929 • Stocks plunge • Investors panic and start to sale

16. Black Tuesday • October 29, 1929 • Bottom Fell Out • Stock tried to be sold • No Buyers • Borrows stuck with debt

17. Great Depression 1929-1940 • Economy Plummeted and Unemployment Rose

18. Banks • Invested in Stock • People pull money out of banks • Banks unable to pay people because they lost money on stocks • Gov’t did not insure savings • Banks went Bankrupt and people lost their money

19. Banks and Business Close • Banks • 1929 – 600 • 1933 - 11,000 • Business • 90,000 Bankrupt

20. Effects of Depression • Hoovervilles • Herbert Hoover believed things would fix themselves (did very little) • People lost houses • Towns constructed of shacks pop up.

22. More Problems • Dust Bowl • Drought in Central U.S. • Plowing mixed soil up • Wind Storms blew top soil away. • Farmers unable to grow crops

23. Family • Men started wondering around U.S. for jobs. • Hobos • Women began working unemployed men resented them • Malnutrition occurred in children • Milk consumption declined drastically

25. Roosevelt Elected • New Deal • Relief for the needy • Economic Recovery • Financial Reform

26. First Hundred Days • 15 major policies passed • Closed Banks to prevent further withdrawals. • Only sound banks could reopen • Those who could not were given loans

27. Alphabet Agencies • Federal Agencies that were created as part of the New Deal • Aim of these agencies was to give Americans jobs and economic relief.

28. Alphabet Agencies • AAA –Agricultural Adjustment Act • Raise Crop Prices by lowering production • Gov’t paid farmers to not farm part of fields • CCC – Civilian Conservation Corps • Gave men between age of 18-25 jobs. • Built roads, developed parks, planted trees. • NIRA – National Industrial Recover Act • Provided money to states for job creation • Construct schools and other public buildings.

29. Second New Deal • Continued to help farmers • Educate youth to create more jobs • Social Security • Insurance for those over 65 in form of money • Unemployment Compensation • Aid for children and disabled.

30. Limitations of New Deal • Women • Jobs given to men • Lower minimum wage then men • African Americans • FDR did not fully support Civil Rights • Agencies discriminated against African Americans.

31. Critics of New Deal • Many felt Gov’t was to large. • Stopped free Enterprise • Many felt U.S. was becoming socialist.

32. Great Depression Ends • From 1931 to 1940 unemployment was always in double digits. • 17 million unemployed in 1939.

33. WWII affect on Depression • US entered the war in 1941 • Workers were needed to go to war. • Soldiers • Nurses • Factory Workers • Etc……..

34. Trade Off • Most Americans now have a job • Who pays for the service the workers are doing? (Government) • Government Pays Soldiers • Government Pays Industry for making weapons of war. • Industry uses that money to pay workers.

35. US Raises Money • How does America get money to pay for all that is needed for war? • Borrowing • US traded unemployment for Debt • National Debt • 1941 = $49 Billion • 1945 = $260 Billion

36. What got America out of the Great Depression? • Roosevelt's New Deal • World War II • Normal Up’s and Down’s of the economy • None or All of the above