The Great Depression

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The Great Depression

• Chapter 22 Sec 12

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In the Late 1920s
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• Many American industries werent making large
  profits.
• Steel, railroads, cars, construction, coal
  mining, lumber.
• Housing sales stopped.
• So what, why do I care!!
• What do you need to put in a new house?

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Causes of the Great Depression
WHY, Why, Why?

• 1. American policies and tariffs cut down the
  foreign market for U.S. goods.
• 2. Overproduction by farms.
• Annual Farm Income
• 1919 10 Billion
• 1921 4 Billion

• 3. Overuse of Credit- people were in debt.
• They buy less goods
• 4. Unequal Distribution of Wealth.
• 70 of the nation made less than 2500 a year.
• ½ of homes had electricity.
• Couldnt afford consumer goods.
• While the income of wealthiest 1 increased by
  25.

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In the late 1920s on farms

• Overproduction made prices fall.
• Farmer got loans for machines and produced more.
  (sound familiar)
• Price fell more.
• Farmers defaulted on the loans and s lost farms.
• Rural banks that gave loans failed.

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In the late 1920s

• Peoples received lower wages.
• They still wanted the nice things they were used
  to having, so they used
• CREDIT- Why is this dangerous?
• When the debt became too big, people stopped
  spending.

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• Election of 1828 Herbert Hoover Wins!!
• Many invested their wealth in the Stock Market
• People were engaging in speculation.
• Seeking quick return investments
• Ignoring the risk involved
• Buying on Margin Buying stocks with borrowed
  money.
• If stock prices fell, they could not pay off the
  loans

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Then.
BLACK TUESDAY
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What was Black Tuesday?

• On October 29th 1929, the stock market crashed.
• Investors hurried to sell stocks before they were
  worthless.
• 30 billion dollars in stock became worthless
  overnight.
• 16.4 million shares of stocks were sold that day.
  Others could not be sold and became worthless.

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The Effects of the Stock Market Crash

• Americans panicked took money out of banks.
• Banks lost money and couldnt pay customers
• By 1933 11,000 of 25,000 banks n the U.S. had
  failed.

• 9 million savings accounts disappeared.
• 90,000 businesses closed.
• 25 of workers were out of work by 1933.
• Those with jobs had pay cuts.

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More Results!!!(These are from Ch 14 sec 2)

• Shanty towns
• Soup kitchens/Breadlines
• Run by ?
• Increase in Racism
• 400,00 farms lost to foreclosure

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• The Dust Bowl
• Drought in the Plain states
• Hobos (1919-1929)
• 24,647 killed for tresspassing
• 27,171 injured on railroad property
• Okies
• 2600 Schools shut down
• 300,000 studen
• Suicide rate up 30

Still More Results!!!
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Americans werestrugglingdemoralizedwithout
hope

• And finally

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The government wanted a quick solution so they
passed

• The Hawley Smoot Tariff act.
• It created a tariff on foreign goods.
• It made things worse.
• Other countries stopped buying our stuff too.