The 1920s

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The 1920s
Louis Armstrong

• The 1920s became known as the Jazz Age or
  Roaring 20s

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The 1920s

• During and after WWI the U.S. was experiencing
  incredible social and economic growth

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The 1920s

• Businesses were experiencing record growth.
• New products were being invented on a scale never
  before seen.

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The 1920s

• Government regulation, labor unions and the
  Progressive movement improved working conditions
  and the quality of life in cities.

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The 1920s

• The average US citizen became more wealthy and
  was more likely to own their own home than ever
  before.

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Herbert Hoover

• Hoover was elected President in 1928

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Herbert Hoover

• He was a Republican and believed that the
  government should not use laws to regulate the
  economy
• However, economic growth during the 1920s was
  dangerously rapid and unstable

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The Stock Market Crash of 1929

• From 1925-1929 the average value of
  all stocks tripled

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CAUSES OF THE GREAT DEPRESSION

• Cause 1 Over-Speculation
• Cause 2 Increasing Consumerism
• Cause 3 Failures of the Federal Reserve
• Cause 4 High Protective Tariffs

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Cause 1 Over-Speculation

• Speculation - engaging in a risky business
  venture on the chance that a quick or sizable
  profit can be made
• Many people during the 1920s began to heavily
  speculate in the stock market

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Cause 1 Over-Speculation

• Many investors commonly bought stock on margin.
  They only paid for part of the stock and borrowed
  the rest

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Cause 1 Over-Speculation

• People who brought stocks on margin did so
  because they knew the price of the stock would go
  up

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Cause 1 Over-Speculation

• Over speculation became very popular and stock
  brokers and banks were lending out huge sums of
  money and this made the stock market and the
  economy very unstable

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Cause 1 Over-Speculation

• In 1929 the stock market crashed. The prices of
  stocks plummeted and barrowed money could not be
  paid back and many banks failed

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Cause 1 Over-Speculation

• Many American banks also paid unsafe loans to
  Europeans so they could pay off their debts from
  WWI

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Cause 2 Increasing Consumerism

• The Industrial Revolution caused the invention
  and mass production of many new products.

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Cause 2 Increasing Consumerism

• Following the gloomy period of WWI, people were
  more willing to spend money to enjoy life.

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Cause 2 Increasing Consumerism

• New advertising methods attracted consumers to
  buy products they might not want or need.

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Cause 2 Increasing Consumerism

• Salesmen were willing to sell products on
  installment plans (pay some now, pay the rest
  later), which caused many consumers to over-spend.

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Cause 3 Failures of the Federal Reserve

• The Federal Reserve (The FED.) was established as
  a federal agency to control and regulate the
  nations banking system and the economy
• The Federal Reserve failed to prevent banks and
  stock brokers from lending out too much money
  during the 1920s

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Cause 3 Failures of the Federal Reserve

• This led to the failure and foreclosure of one
  forth of the banks in the US.

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Cause 3 Failures of the Federal Reserve

• This also led to a severe contraction in the
  nations supply of money in circulation

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Cause 4 High Protective Tariffs
TRADE

• Tariffs - taxes that are added to imported
  goods. They are designed to protect industries
  and businesses in the U.S.

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Cause 4 High Protective Tariffs

• In response to the U.S. tariffs, the countries of
  Europe raised their own tariffs

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Cause 4 High Protective Tariffs

• Tariffs interfered with world trade because they
  destroyed foreign markets for American products

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Cause 4 High Protective Tariffs

• The Hawley Smoot Tariff was passed in 1930 and
  was one of the highest tariffs in U.S. history
• This tariff only made the Depression worse
  because countries could not help each other

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The Great Depression
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IMPACT OF THE GREAT DEPRESSION
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Black Monday

• October 28th, 1929
• A combination of factors prompt a record 16.4
  million shares to be sold in one day.
• Over the next two days, the stock market was down
  by 25.
• By July of 1932, the market was down 90.

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The Stock Market Crash of 1929

• Many investors lost their life savings

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1) Bank Failures

• When the Stock Market crashed people rushed to
  the banks to withdraw money
• Because the banks loaned out so much money they
  could not pay everyone when they came to withdraw
  their money

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1) Bank Failures

• Much of the money was invested in peoples houses
  and businesses.

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1) Bank Failures

• Banks begin to foreclose on peoples mortgages to
  get the money back.
• Foreclose when banks take peoples property
  when they cant pay their debts.

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BANK FAILURES 1929-1933
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1) Bank Failures

• This caused thousands of banks to close and many
  Americans lost their life-savings
• The U.S. financial system collapsed because the
  Federal Reserve failed to regulate banks and the
  stock market

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2) Unemployment and Homelessness

• At the height of the Depression 25 of Americans
  were unemployed

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2) Unemployment and Homelessness

• The unemployed soon were unable to pay their
  rents and were evicted from their homes

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2) Unemployment and Homelessness

• Cities and towns throughout the country
  established soup kitchens and bread lines as
  local governments tried to feed the poor

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2) Unemployment and Homelessness

• The number of homeless multiplied and they began
  to move into makeshift towns made out of scrap
  wood and tin shelters
• (These were called Hoovervilles)

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3) Political Unrest and Unions

• Drastic increases in poverty and unemployment led
  to the growing militancy and political unrest of
  labor unions during the 1930s

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3) Political Unrest and Unions

• Example Support for the Communist and Socialist
  parties began to rise during the Depression

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3) Political Unrest and Unions

• Example The Bonus Army unemployed veterans of
  WWI protested outside the White House demanding
  that they should be paid their income bonus
  early

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3) Political Unrest and Unions

• President Hoover used the military to forcefully
  remove the Bonus Army protestors

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The Bonus Army
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4) Farm Foreclosures and Migration

• The Great Depression hit the farmers in rural
  America the worst
• (crop prices were actually lower than what it
  cost to transport them to market)

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4) Farm Foreclosures and Migration

• Many farmers destroyed crops in protest rather
  than sell them for such low prices

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4) Farm Foreclosures and Migration

• The banks foreclosed 10 of the nations farms
  and many farmers were forced to migrate

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4) Farm Foreclosures and Migration

• Many migrated to cities and coastal areas to seek
  other work

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5) The Dust Bowl

• In the mid 1930s a horrible environmental
  disaster struck the farmers of the Great Plains
• During WWI American farmers began to over-farm
  the Plains

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5) The Dust Bowl

• The grasslands were now plowed instead of being
  filled with cattle herds

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5) The Dust Bowl

• When severe drought struck, the topsoil blew away
  as huge dust storms that filled the skies

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5) The Dust Bowl

• The farmers of the Dust Bowl left as migrants and
  many went to California to work

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The Election of 1932
Herbert Hoover VS. Franklin D.
Roosevelt
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Herbert Hoover

• 1) Republican
• 2) Passed the Hawley Smoot Tariff
• 3) Hoover would not use the government to control
  big businesses (believed in Voluntary Control)
• 4) Hoover would not use the federal government to
  help the poor (believed in Voluntary Aid)

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Franklin D. Roosevelt

• 1) Democrat
• 2) Rallied a frightened nation by saying We have
  nothing to fear but fear itself.
• 3) Believed in increasing the size and power of
  the federal government to regulate big business
  and the economy
• 4) Believed in using government funds to aid the
  poor

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Franklin D. Roosevelt

• Franklin Roosevelt rallied the frightened
  nation by saying
• The only thing we have to fear is fear itself

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FDR won by 7 million votes
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Franklin Roosevelts New Deal

• The New Deal FDR created and passed many new
  laws and social programs that were funded by the
  federal government to pull the country out of the
  Depression

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A) Emergency Banking Act

• To help slow the banking crisis, FDR closed all
  banks in the U.S. for three days
• He gave banks federal funds so they could reopen

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B) Federal Deposit Insurance Corporation (FDIC)

• This law insured the money that people deposited
  in the banks
• FDR did this to restore public trust and
  confidence in the bank and to reform unsound
  banking laws

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C) The Works Progress Administration The
Civilian Conservation Corps (CCC)

• These were government relief measures designed to
  provide direct payment to people for immediate
  government aid
• These programs did this by giving millions of
  unemployed men jobs

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C) The Works Progress Administration The
Civilian Conservation Corps (CCC)

• They worked in national parks and other public
  works projects like dams and roads

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The Civilian Conservation Corps (CCC)

• Responsible for the construction of many parks as
  well
• Skyline Drive

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Tennessee Valley Authority

• Built dams and power plants to provide
  electricity to rural areas.

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DAM!
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D) Agricultural Adjustment Act (AAA)

• Over-Production of crops made prices drop very
  low
• FDR used federal funds to pay farmers to NOT
  produce crops
• This was a recovery program that was designed to
  bring the county out of depression over time

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E) Social Security Act

• This new program was designed to offer safeguards
  for workers

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E) Social Security Act

• Social Security is a system that taxes workers so
  it can repay them later in life to ensure that
  workers can retire
• Social Security also provided Unemployment
  Insurance

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Success of the New Deal

• New Deal programs did help provide relief to
  workers and they lessened the effects of the
  Depression

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Success of the New Deal

• The United States did not fully come out of the
  Depression until WWII
• (Wars have a tendency to do that)