26.1 The Great Crash

The Great Depression

Chapter 26

a. Some industries had problems throughout the 1920’s• Farming• Textiles (Clothing and Materials)• Coal Mining

b. Lack of government statistical data

c. Hoover reassures the public

1. Signs of Economic Trouble

a. Investors sell their stocks

b. Prices plunge – no buyers

c. People bought on margin – bought part of the cost of the stock at purchase

d. Black Tuesday – the day of the crash on October 29, 1929

2. The Crash

Americans rush to the bank to claim their money

The Great Depression – economic hardship that lasted from 1929-1941

a. Causes

• Overproduction

• Weak Banking

• Low Wages

3. The Great Depression Begins

3. The Great Depression Begins

• Banks– Granted unwise loans– Over 5,000 banks close– Lifetimes savings gone overnight

3. The Great Depression Begins

b. The Downward Spiral

• One disaster after another

• No business growth

• Factories cut production, wages, employees

• Businesses go bankrupt – unable to pay debts

What happened to Europe?

• American banks lent money to Europe after WWI.

• US banks stop loaning, and European banks collapse

4. Hard Times

a. Rising Unemployment• 1 in 4 workers jobless• On the streets: apple sales, beggars,

garbage pickers, sidewalk stands

b. The Human Cost• Marriage and birth rates down• Families split• “Riding the rails”

5. Hoover Responds

A. Government Aid– Relief programs – helped the needy– Soup kitchens – set up by communities to

feed the hungry– Public works – projects built by government

for the public

B. Depression Deepens– Hoovervilles – shacks where homeless

lived

6. The Bonus Army

Congress tries to help WWI veterans but fails

WWI vets are angry– Bonus – additional sum of money– Bonus Army – a community of jobless

veterans that lived in tents in Washington DC