The Age Of Anxiety, The Crash & The Great Depression Brother, can you spare a democracy?
Movies • Replaced traditional arts and amusement – weekly entertainment
Radio • Commercially available in 1920 • Most households in Britain and Germany had inexpensive sets by late 1930s • Political propaganda tool
European Politics • 1922 France and Belgium occupied the Ruhr • American Dawes Plan (1924) cut reparations and funded European recovery with American loans • Weimar Republic (democracy) in Germany • Gustav Stresemann (1878-1929) • Britain – Labour Party passed welfare measures guaranteeing social peace and class equality
Why Did The Stock Market Rise So Much During the Late Twenties? • Unreal share prices • Investors speculation
This speculative rise is called a “Bubble.” And we all know what happens to bubbles.
Why Did The Market Crash In October,1929? • A bubble can only expand . . . • Once the new money runs out . . .
In Three Weeks, The Market Lost . . . $30 Billion
How Did The Stock Market Crash Weaken Banks? • 1. Banks had loaned money . . . • 2. Banks had invested. . . .
Bank Losses Led To A . . . Bank Run!
How Did Uneven Wealth Distribution Cause The Depression? • The middle-class didn’t have enough money to buy all the goods America was making. • Demand crashed.
How Did Loss Of Export Sales Cause The Depression? • Congress passed a heavy tariff on imports. (Why?) • Foreign countries passed their own tariffs in revenge. • Exports sank, which meant another reduction in demand.
What About Mistakes By The Federal Reserve? • The Fed sets the nation’s interest rates. • During the Depression it raised rates, which reduced the people’s ability to spend. • Again, demand was reduced.
Traditional Conservative Authoritarians vs. Radical Totalitarians