U.S. History Chapter 11 Notes The Great Depression Begins

1. U.S. History Chapter 11 Notes The Great Depression Begins

2. Section 1The Nation’s Sick Economy

3. Economic Troubles on the Horizon • Problems began threatening economic prosperity by the end of the 1920s • Farm debt - • Consumer debt - many people were buying goods on credit • More goods then buyers - prices rose faster than wages • Declining Trade – • Income disparity - Consumers & farmers went steadily deeper into debt

4. Industries in Trouble • Key industries like railroads, textiles, steel barely made profit • Mining, lumbering expanded during were no longer in high demand • Boom industries - automobiles, construction, consumer goods weakened

5. Farm Troubles • International demand for U.S. grain declined after war - prices dropped by 40% or more • Farm income declined & farmers defaulted on loans • Congress attempted to pass the McNary- Haugen bill to help farmers - Price-supports -

6. Consumers Problems • 1920s - rich got richer & poor got poorer • 70% of families earned less than minimum for decent standard of living - $2500 annually • Many people had been purchasing goods on credit (buy now, pay later) • Consumers had trouble paying off debt & cut back on spending

7. OBJ #1 - Describe the CAUSES and SPARK of the Great Depression. How did Overproduction affect both farmers and industry? What system collapsed and caused millions to lose their savings? Explain how buying on Margin created the Spark. How did people lose money because of the spark? I. OBJ #1- Cause & Spark of the Depression A. Causes of the Depression 1. Overproduction,) a. Factory Workers begin to get layed-off - b. FarmersCan’t Survive c. Supply & Demand- Prices Drop 2. Bank Failures a b. c. d.

8. 1920’s Problems BANKS Have NO $$ PEOPLE LOST SAVINGS & JOBS NO ONE TO HELP!

9. Banks Close Banks have no money to give people + = People Default on Loans People Loose savings

10. The Election of 1928 • Democrat Alfred E. Smith - four times governor of New York • Republican • U.S. had experienced prosperity under Republicans in 1920s

12. Dreams of Riches in the Stock Market • Late 1920s – Some economist warning of weaknesses in the economy - Most Americans ignored them • Dow Jones Industrial Average was used as barometer of the market’s health -

13. Dreams of Riches in the Stock Market • 1920s - stock prices rose steadily “Bull Market”

15. The Stock Market Crashes • September 1929 stock prices peaked & then fell • October 24, 1929 - Market took plunge & many panicked investors unloaded their shares

16. The Stock Market Crashes • October 29, 1929 - Stock market crashed (Black Tuesday) - - - -

17. OBJ #1- Cause & Sparks of Depression TOO MUCH STUFF! QUICK REVIEW: Causes: 1. 2. Spark: 1. Results: 1. 2. BLACK TUESDAY

18. Financial Collapse • Great Depression – - lasted from • After crash, people panicked & withdraw money from banks • Banks • 1929 to1932 - gross national product was cut nearly in half - 90,000 businesses went bankrupt • 1933 • Those with jobs received cuts in hours & pay

19. Worldwide Shock Waves • Great Depression limited U.S. ability to import European goods • Other countries couldn’t earn American currency to buy U.S. goods - Many countries retaliated by raising their own tariffs

20. Causes of the Great Depression • Factors leading to Great Depression: • Declining Trade – • Farm problems - Many farmers were forced to sell • Easy credit – Borrowed money to invest in market • Income disparity

21. Section 2Hardship and Suffering During the Depression

22. The Depression Devastates People’s Lives • People lost jobs & were evicted from homes • Had to live in parks or sewer pipes • Shantytowns -

23. The Depression Devastates People’s Lives • People dug through garbage & begged - Soup kitchens offered free or low-cost food - Bread lines - people lined up for food from charities & public agencies • African Americans & Latinos had higher unemployment & lower pay • Minorities were also targets of violence (Lynching or deportation)

24. The Depression in Rural Areas • Most farmers could grow food for their families

25. The Dust Bowl • Farmers in Great Plains exhausted land through overproduction • 1930s - drought & windstorms scattered for hundreds of miles • Dust Bowl

30. The Dust Bowl • Many farm families migrated to Pacific Coast

31. OBJ #3 - Describe the natural disaster that affected the U.S. during the Great Depression. What was the disaster’s nick-name? What caused the disaster? Where did the people go to try and escape their troubles and how were they treated (nick-names for these people)? III. OBJ. #3- Natural Disaster “The DUST BOWL” A. Great Plains suffers a huge Drought (1931) 1. Causes: a b 2. Huge Dust storms cover ‘Great Plains B. Results 1. 2., a. b.

33. Effects on the American Family • Family was source of strength for most Americans • Believed in traditional values and emphasized the importance of family unity • Some families broke apart under strain of making ends meet

34. Men in the Streets • Many men used to working & supporting families had difficulty coping • Couldn’t find jobs • Many stopped trying • Some men even abandoned their families

35. Women Struggle to Survive • Women worked hard to help their families survive the adversity • Women worked outside home & were resented by unemployed men

36. Women Struggle to Survive • Early 1930s – Some cities refused to hire married schoolteachers • Many women

37. Children Suffer Hardships • Poor diets & health care led to serious health problems in children • Teenagers left home & rode trains in search of work & adventure - Many died or were beaten

38. Social and Psychological Effects • 1928 to 1932 – • Admissions to state mental hospitals tripled • Put off marriage & children • Many people showed great kindness to strangers - Gave food, clothing & a place to stay

39. Section 3Hoover Struggles with the Depression

40. Hoover Tries to Reassure the Nation • President Herbert Hoover told Americans the economy was sound • Many experts believed depressions were normal part of business cycle - Believed that it was best to do nothing & let the economy fix itself • Hoover believed government

41. Hoover Tries to Reassure the Nation • Many believed that people should succeed through their own efforts • People should take care of own families & not depend on government • Hoover

42. Hoover Takes Cautious Steps • Hoover called meeting of business, banking, labor leaders to solve problems - Asked them to work to together to solve the problems • Created organization to

43. Hoover Takes Cautious Steps • Hoover’s authorized the construction of the Boulder Dam on Colorado River w - later renamed Hoover Dam -

47. Democrats Win in 1930 Congressional Elections

48. Democrats Win in 1930 Congressional Elections • Farmers tried to create food shortages to raise prices

50. Hoover Takes Action • Hoover softened his stance on no government intervention in the economy • Hoover negotiates agreements among private entities • Backs - buy crops, keep off market until prices rise