The Nation’s Sick Economy
Section 22-1
pp. 670-677
Preview Questions
• Why was the nation’s economy sick in
the late 1920’s?
• What was Black Tuesday?
• How did the stock market crash affect
businesses?
Trouble on the Horizon
• Farming
– Overproduction  Lower prices
– Default on mortgages and lose land
– Price supports vetoed
• Overproduction of Goods
Trouble on the Horizon
• Credit
– Accumulated debt and couldn’t pay it off
• Uneven Distribution of Income
– People lack money to buy consumer goods
Hoover Takes the Nation
• Hoover (R) elected in 1928
• Problems in Stock Market
– Speculation
– Buying on Margin
– Inflated Stock Prices
Stock Market Crashes
• Black Tuesday
– October 29, 1929
– Sharp decline in
prices: “Crash”
– $30 billion lost by
November
Financial Collapse
• Great Depression
– Period of bad economic times 1929-1940
– Banks and businesses close
– Spread worldwide
Financial Collapse
• Hawley-Smoot Tariff
– Attempt to stimulate U.S. economy
– Leads to decrease in foreign trade