Stock Market Crash/Great

Depression/New Deal

Black ThursdayOct. 24, 1929

Stock prices slowly fall

Worried investors sell, prices fall

Bankers pool money to buy stock

Black TuesdayOct. 29, 1929

Record 16.4 million shares sold

Known as the “Great Crash”

Overall losses total $30 billion

Overspeculation

Buying stocks w/ borrowed money

Ripple Effects of the Crash

a. risky loans hurt banksb. consumer borrowingc. bank runs

Ripple Effects of the Crashd. bank failures

e. savings wiped out f. cuts in productiong. rise in unemployment

Causes of the Great Depression

• Overproduction and low demand leads to employee layoffs

• Low wages reduce consumer buying power• High tariffs restrict foreign demand for

American goods• Unemployment reduces buying power further

Low crop prices hurt farms:

Foreclosed on & sold at auction

The Dust BowlCaused by drought &

overplowing

60% of families lose farms!

Stresses on Families

Living conditions decline

Divorce rate drops,

why?

Many men have low self-esteem

Discrimination Increases

Competition for jobs increases

Rise in suspicions & hostilities against minorities

Govt. relief programs discriminate

People Help Each Other

1. Tenant groups form

2. Farmers work together

3. Young people leave home

a. For necessity or adventure

b. Faced many dangers

Humor Helps

People use jokes & cartoons

My father always said, “When I was a kid we had no shoes to wear and our clothes were hand-me-downs.  We had little food to eat,

and no car to put gas in even if we had money for gas. 

Then came the Great Depression, and things got tough.”

Signs of Change

Prohibition Repealed

1.21st Amendment repeals 18th

2.Control returns to states

Empire State Building1. 2,500-4,000 people

worked per day

2. Cost $41 million

3. 102 stories; 1,250 ft. tall

Election of 1932

Hoover's Limited Strategy

Hoover, Henry Ford, Thomas Edison, Harvey Firestone

Voluntary Action1. Insists key to recovery is

confidence

2. Believed voluntary actions by businesses was best way to

end crisis

3. Held rigidly to his principle

Agricultural Marketing Act

Created Federal Farm Board

Designed to stabilize prices

Failed-lost $150 million

Spends money on new:

Public buildings

Roads

Parks

Dams

Hawley-Smoot Tariff

a. Highest import tax in history

b. Backfired

c. European countries raise tariffs

Reconstruction Finance Corporation

a. Gave credit to some institutions

b. Lent money to banks

c. Passed Home Loan Bank Act

Bonus Army1. 20,000 WWI veterans encamp in D.C.

2. Wanted immediate payment of pension bonus

3. House agrees-Senates doesn't

4. Some violent incidents

5. MacArthur uses army to force them out

The Election: 2 Views of Government

Hoover- Voluntary aid: Resisted idea of giving

federal govt. more power

Roosevelt-More government intervention

The New Deal:Relief, Recovery, Reform

“The only thing we have to fear is fear itself.”

FDR

Stabilize the Banks“Bank holiday”

-Emergency Banking Act:-closed banks for 4 days

-inspect financial health-Glass-Steagall Act: creates FDIC-insures bank deposits-SEC regulates stock market

Relief & Jobs

*Public works programs

Civilian Conservation Corps-2.5 million maintain forests, beaches, & parks-earn $30 a month!

National Recovery Administration (NRA)

-created to help businesses -controlled: wages, working conditions, prices, &production-similar to WWI controls

Tennessee Valley Authority (TVA)

-helped farmers in least developed area of U.S.

-hydroelectric power

Key Players“brain trust:-informal advisors

Eleanor Roosevelt-actively promoted New Deal-FDR’s eyes and ears-one of the most influential 1st ladies

2nd New Deal:More social

welfare

Works Progress Administration (WPA)

-supported artists & writers

-creates 8 million jobs

Wagner Act-collective bargaining legalized

-outlawed blacklisting & union spying

-bans child labor and sets minimum wage

Social Security-old age pension

-unemployment insurance

-aid for dependents

CriticsDemagogues: manipulate w/ half-truths, deceptive

promises & scare tactics

Father Coughlin

Huey Long

“Packing” the Supreme Court

-add 6 more judges

-wanted more support for New Deal

-aroused the most opposition

1937 Recession

-national debt rising

-caused by increase in federal spending

-forces cuts in ND programs

Culture“Grapes of Wrath”:

depicts life for farm families

Movies provide escape

Impact of New Deal

Restored sense of hope

Financial assistance for farmers

Programs still around: TVA, FDIC, SEC