The Nations Sick
Economy
Chapter 14
Section 1
Information from the textbook The Americans, 2006
Industries…
• Steel, railroad, textiles were
barely making a profit
• Decreased demand for Mining
and lumber, autos, construction
and consumer goods
• Housing and related industries
show “slowing”
Agriculture
• Farmers increased supply
which caused a decrease
in price and a decrease in
their income
• Many farmers lost their
farm
Election of 1928
• Herbert Hoover (Rep) vs.
Alfred E. Smith (Dem)
• Hoover wins!
Stock Market
• Many Americans were buying
stock.
• Dow Jones Industrial Average
–A measure based on the stock
prices of 30 representative
large firms that trade in the
NYSE
Stock Market
• “Bull Market” led to more people
investing in stock
• Speculation (hoping to turn a
quick profit)
• Buying on the Margin (making a
down payment but borrowing
the balance to buy stock)
Black Tuesday
• October 29
• Shareholders sold 16.4
million shares of stock (and
many more didn’t sell)
• People stuck with debt
The Great Depression
• 1929-1940
• 11,000 banks failed by 1933
–People withdrew money
and banks had invested in
stock (so they also lost
money)
The Great Depression
• GNP decreased by half
• Unemployment up to 25%
• Many who were still
employed faced pay cuts
and reduced hours
Hawley-Smoot Tariff Act
• Set a high tariff
• Resulted in decreased amount of
imports
–Foreign countries weren’t earning
money and couldn’t afford to buy US
goods.
• Decreased demand caused increase in
unemployment
• Foreign countries also increased tariffs
Causes of the Great
Depression
• Tariffs and war debt
• Farming crisis
• Availability of credit
• Unequal distribution of
income
Hardships and Suffering
During the Depression
Chapter 14
Section 2
Information from the textbook The Americans, 2006
Cities
• Unemployment
• Evictions
• Shantytowns
• Soup kitchens
• Bread lines
• Racial violence
Rural Areas
• Farmers could grow food for
families
• Many farmers lost their land
• Dust Bowl
–Drought in the 1930s
–Many moved from drought
stricken states to California
Men
• 300,000 transients or
“hoboes” wandered the
country
Women
• Working women were
resented
–Jobs were scarce
–Married women should
stay at home and let men
have jobs
Children
•
•
•
•
Health problems from poor diets
School year shortened
Working to help earn money
“Wild boys”
– left families in search of jobs
• “Hoover tourists”
–Traveled the country by train
–24,647 trespassers killed
–77,171 injured
Social and Psychological
Effects
• Suicide rate increased
• More people were admitted
to mental hospitals
• Many people helped others
that were in need