Learn about the sequence of events that led to the Great Depression in the 1920s, including the stock market crash, banking crisis, and soaring unemployment rates. Discover the effects on American citizens, businesses, and the government's response under President Hoover. Explore the economic repercussions, societal challenges, and the election of Franklin D. Roosevelt in 1932 as a response to the crisis.
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10.1 End of Prosperity 1920 s was prosperous due to making money in the stock market-buying at $85 and selling at $549 Buying on margin helped poor people buy stock-purchased on credit and pay back loan with profits made off stock Bull slogan-stock increasing Bear slogan-stock decreasing Few people thought what if the prices decreased
Black Tuesday Stocks peaked in 1929 then began to decrease People panicked to sell in order to pay off loan & within 3 hours the market lost $11B Within days, it decreased again Black Tuesday-the day the stock market crashed
Economy Collapses Immediate effect-banking crisis- due to investing in stock market, they lost their money & customers could not pay back loans-many closed their doors. People and businesses with money in the bank lost it all so many businesses closed their doors. Other businesses decreased work force due to lack of demand-many people lost their jobs. Unemployment soared to more than 4 million Americans
The Cause-Recession Economy typically increases and decreases daily-known as the business cycle. But when people lose their jobs or fear losing their jobs, spend less money which causes more businesses to close their doors due to lack of demand. Cars and appliances sold rapidly at the beginning of the 20 s but by the end, most people had one of each so demand decreased.
President Hoovers Reaction Many expected the government to provide relief but Hoover didn t believe it was the govt problem to solve. Reconstruction Finance Corporation- loaned $1.2B to banks but not directly to American families Hoovervilles were where many Americans lived in cardboard or tin shacks Political Cartoon p. 297
Bonus Army American veterans gathered in DC to demand military pay Hoover ordered General Douglas MacArthur to use force to remove them from DC Some people were actually killed and this infuriated Americans
Election of 1932 Most Americans had lost hope and trust in Hoover. Many even blamed him for the Depression. Franklin Delano Roosevelt (FDR) was NYC Governor and had helped those citizens during the Depression. He ran against Hoover as a confident and optimistic candidate. FDR won easily and promised a new deal for America
FDR p. 299 Homes in NYC, DC, and Warm Springs, Georgia Served as NY Senator & Governor, Secretary of the Navy, President of the USA (12 years) during the Great Depression and WWII Handicapped due to Polio Quote: The only thing we have to fear is fear itself. -FDR 33
The New Deal New Deal - program to battle the economic recovery Banking Relief Act-reopen if monitored by the govt Civil Works Administration put unemployed Americans to work building roads Civilian Conservation Corps provided jobs to plant trees and improve parks
New Deal cont... Tennessee Valley Authority hired people to build dams and generators to provide electricity to rural areas Farm Credit Administration helped farmers manage their farms and debts Agricultural Adjustment Act helped stabilize agricultural prices National Industrial Recovery Act eliminated unfair competition
Fireside Chats On Sundays, President Roosevelt talked on the radio to Americans He explained what was going on and encouraged Americans to have hope This helped Americans trust the government again See pic p. 302
Critics Not all Americans approve of the New Deal Some believed it went too far and others believed it didn t go far enough (can t please everyone always) Feared new taxes to pay for these programs in New Deal Roosevelt continue to add more programs regardless
Second New Deal Works Progress Administration put people to work all over the country on several projects National Youth Administration gave part time jobs to youth Social Security Act provided financial security to elderly and disabled people Federal Deposit Insurance Corportation-FDIC-guaranteed deposits in bank accounts Chart p. 303
National Industrial Recovery Act Required minimum wage Allowed collective bargaining- allowed workers to join labor unions and participate in collective bargaining Labor unions grew and became very political By the end of the Great Depression, many people had better access to roads, electricity, and recreation areas.
Eleanor Roosevelt First Lady of the USA Married to President Roosevelt (5th cousin) and was niece to Teddy Roosevelt Took an active role in helping solve problems around the country-she supported the New Deal Stressed the importance of helping youth and disabled- strong supporter of civil rights
Americans Face Hard Times Farmers experienced very difficult times due to prices for farm products remaining low Then a severe drought hit the Great Plains and lasted over a decade-N Dakota to Texas farms withered away Massive dust storms blew the topsoil away making it impossible to replant-referred to as the Dust Bowl Map p. 309
Dust Bowl Many farmers lost their farms with no income Soil conservation taught farmers new farming methods- planted grass and trees to break the wind About 2.5M farmers left the area-many moved to California but found it difficult to get work there too
Hard Times Families split up so others could roam to find work Many immigrants were deported -even with American born children Mary McLeod Bethune-an African American educator was appointed to President s Cabinet to assist with the concerns
Depression Culture/Arts WPA put painters, sculptors, writers, and actors to work & recorded cowboy ballads, folk songs & African American spirituals John Steinbeck wrote about the GD in Grapes of Wrath p313 Duke Ellington introduced the swing to lift spirits Listened to Little Orphan Annie and Lone Ranger on the radio Movies helped Americans escape troubles
TEST TIME Watch American Girl movie on Great Depression Know vocabulary and key terms Thoroughly explain main ideas on top of p. 315 Study the review on p. 315-316 Practice Quizlet Make an A!
Effects of New Deal Expanded role of government Created major programs that still exists (FDIS & SSA) Provided hope and relief to many Americans but did not end the Great Depression It took the next war to actually end the Great Depression
