The Great Depression
The End of Prosperity…The
Beginning of a Colossal Struggle
1920’s- Evidence of Prosperity
• 1921- 1.5 million cars
sold
• 1929- 4.5 million cars
sold
• 80 million people to
movies/ week
• Rising stock prices
• 1928 RCA ($85$420)
Rising Stock Prices= Bull Market
• Continuing rising
stock prices
• “Everybody Ought to
be Rich”
• People “bought on the
margin”
• Speculation
What goes up…must come
down!
• Few predicted a Bear
Market
• This is a continual
drop in stock prices
And then BAM!!
October 29,1929
• Black Tuesday
• $15 Billion in stock
lost in one day
• Panic spreadeverybody sold their
stocks
Panic of 1929 ensued…
• $50 billion loss by end
of November
• Examples
• GE- $396- $168
• US Steel- $261- $150
• “on the margin”
purchasers forced to
sell everything
Economic collapse…a vicious cycle
• Andrew Mellon and
comrades in denial
• Businesses slowed
production/ laid off
workers
• No jobs/ no
consumption
• More lay offs/ slower
production
And this is how the Great Depression
began
• Between 1929 and
1931 the GNP dropped
by almost 30%
• Unemployment
quickly rose to over
20%
Banking crisis
• Unable to pay bank
debts(farmers, individuals)
• Small banks could not pay
big banks and failed
• People rushed to take out
their money
• 1929- 1933- 9,700 banks
failed
What did people think?
This was all part of the natural
business cycle in a free enterprise
economy
Causes of the Great Depression
1.
2.
3.
4.
5.
Overproduction
Bank failures
Stock market crash
Struggling industries
Unequal distribution
of wealth
6. Unwise trade policies
Coming to a classroom near
you…
President Hoover and the Great
Depression
HERE IT IS….
Depression hits home
• Who suffered?
• Everybody
• Especially new
immigrants, Latin
American, African
Americans
• They were the last to
be hired, first to be
fired
In the Cities…
• Thousands of
unemployed competed
for jobs, food, and
shelter
• Sometimes literally• American citizens
fought for food scraps
like animals
Farm families
• Better equipped to get
basic necessities
• “It’s my sister’s turn to
eat” WV schoolgirl
People lost their homes and left
to look for work…
• People begged for
food
• Stole food
• Some starved to death
• Built clusters of
shacks from cardboard
or wood
• Blamed Hoover…
Hooverville
How did people survive?
They
needed food clothing, shelter, and money.
• Relatives, neighbors,
and churches
• Red Cross
• Salvation Army
• People robbed bread
trucks
• Private charity could
not provide for all
More to come…
Hoover’s philosophy
• Gave little help to
Americans
• Insisted economic
downturn was
temporary
• In 1930 declared, “The
Depression is Over”