The Great

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The Great Depression 1929-1945
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Economic Troubles

• Prosperity is superficial
• Several industries barely making profits
• You can tell economy by housing situation
• Farmers one of hardest hit groups
• Prices fall govt tries to help
• Coolidge vetoes McNary-Haugen bill
• Consumer spending down
• Huge gap between rich poor
• Many Americans overspend, buying on credit

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Stock Market Crash

• Economists warn of weaknesses in early 1929
• Too much speculation of stocks
• Stock prices decline into October
• 1st dumping happens on Oct. 24th
• Collapse happens on Black Tuesday, Oct. 29th
• Terrible panic w/ everybody selling stocks
• Record 16 million shares dumped, millions not
  sold
• Losses totaled over 30 Billion by early Nov.
• Crash signaled beginning of Great Depression

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Effects of Stock Market Crash

• Americans had purchased stock on margin
• Paid 10 down, pay the rest when stock prices
  fall
• Americans did not have the money to pay back
• Banks failed
• Unemployment rises from 3 (1929) to over 25
  (1933)

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Banks Failed

• After the crash, many begin withdrawing money
  from banks
• Banks had invested other peoples moneys
• Millions of people lost their life savings
• Banks closed because withdrawals outnumbered
  deposits

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Government Reacts

• Government passes Hawley-Smoot Tariff
• Highest protective tariff in history
• Tariff backfires, closing foreign markets to our
  goods
• World economy suffers also
• Businesses do not sell goods to Americans or
  foreigners

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President Hoover

• Continues laissez-faire economics
• Does not offer assistance to Americans
• Believed in rugged individualism
• Americans should help themselves
• Individuals and charities may give to needy

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Soup Kitchen sponsored By a local church
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Hoover continued

• Many Americans blamed Hoover for Depression
• Those who lost their homes lived in Hoovervilles

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Hooverville
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Bonus Army

• 1932, World War I veterans marched on Washington
  DC
• Demanded early payment of bonus
• Not due until 1945
• Congress denied payment
• Some refused to leave
• Hoover ordered US Army to drive veterans and
  families out
• Cost Hoover the Election of 1932

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Bonus Army camped outside US Capital Building
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Election of 1932

• Franklin Roosevelt (D) won
• Promised Americans a New Deal
• Very vague, but he won
• Was inaugurated on March 4, 1932
• Too much of a delay
• Congress passed the 20th amendment
• Changed inauguration to January

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Bank Holiday

• 1 problem in US was bank failures
• FDR ordered all banks to close for one week
• US Treasury would inspect all banks
• Only good banks would re-open
• After one week, banks re-opened, deposits
  outweighed withdrawals for first time since
  Depression began
• FDR increased American confidence in banks

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New Deal

• FDRs New Deal promised bold experimentation

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Civilian Conservation Corps
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Critics of FDR

• Father Coughlin
• Wanted to guarantee income for elderly people
• Would have to spend money every month
• Would create jobs
• Later became the basis for Social Security

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More Critics

• Huey Long
• Share the Wealth
• Wanted to guarantee every child a college
  education
• Every family would receive a new home
• Was assassinated before he could run for president

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Court Packing

• Supreme Court struck down two of FDRs New Deal
  programs
• AAA and NRA
• FDR wanted to change the number of Supreme Court
  judges
• Would ensure that he would have friends on the
  court
• Public and Congress were outraged
• FDR did not get to appoint new judges