AP United States History - Terms and People – Unit 11, Chapter 32 (13th Ed.)
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and become a responsible citizen. Therefore, on my honor, I pledge that I have neither given nor received unauthorized assistance on this work.
The Politics of Boom and Bust: 1920 – 1932
Before studying Chapter 32, read over these “Themes”:
Theme: The Republican administrations of the prosperous 1920s pursued conservative, pro-business policies at home
and economic unilateralism abroad.
Theme: The great crash of 1929 led to a severe, prolonged depression that devastated the American economy and spirit,
and resisted Hoover’s limited efforts to correct it.
After studying Chapter 32 in your textbook, you should be able to:
1. Analyze the domestic political conservationism and economic prosperity.
2. Explain the Republican administrations’ policies of isolationism, disarmament, and high-tariff protectionism.
3. Compare the easygoing corruption of the Harding administration with straight-laced uprightness of his
successor Coolidge.
4. Describe the international economic tangle of loans, war debts, and reparations, and indicate how the
United States dealt with it.
5. Discuss how Hoover went from being a symbol of the twenties business success to a symbol of depression
failure.
6. Explain how the stock-market crash set off the deep and prolonged Great Depression.
7. Indicate how Hoover’s response to the depression was a combination of old-time individualism and the new
view of federal responsibility for the economy.
Know the following people and terms. Consider the historical significance of each term or person.
Also note the dates of the event if that is pertinent.
A. People
Warren G. Harding
Charles Evans Hughes
Andrew Mellon
Herbert Hoover
Albert F. Fall
Harry M. Daugherty
Charles R. Forbes
Calvin Coolidge
John W. Davis
Robert La Follette
Alfred E. Smith
B. Terms:
“Ohio Gang”
trade association
American Legion
Washington Conference
Kellogg-Briand Pact
Fordney-McCumber Tariff
Teapot Dome scandal
farm block
McNary-Haugen Bill
AP United States History - Terms and People – Unit 11, Chapter 32 (13th Ed.)
HONOR PLEDGE: I strive to uphold the vision of the North Penn School District, which is to inspire each student to reach his or her highest potential
and become a responsible citizen. Therefore, on my honor, I pledge that I have neither given nor received unauthorized assistance on this work.
*Boulder Canyon Project Act
Dawes plan
“Hoovercrats”
Agricultural Marketing Act
Hawley-Smoot Tariff
“Black Tuesday”
Muscle Shoals Bill
Reconstruction Finance Corporation
Bonus Army
Stimson doctrine
Good Neighbor policy
*=A 100 Milestone Document from the National Archive. Go to Webpage to link to these documents.
C. Sample Essay: Using what you have previously learned and what you read in Chapter 33, you
should be able to answer an essay such as this one:
Historians have not looked too kindly on the presidents of the 1920’s, usually judging them as
mediocre. Who were the presidents of the 1920’s, and do you agree with this evaluation of their
performance? Explain why.
D. Voices from the past:
In 1928, Republican Presidential nominee Herbert Hoover said:
"We in America today are nearer to the final triumph over poverty than ever before in the history of any land.
The poorhouse is vanishing from among us."
Frederick Lewis Allen, in his social history of the period, Since Yesterday (one of your summer readings and a
source for outside readings):
“The official statistics of the day gave the volume of trading as 16,410,030 shares, but no one knows how many
sales went unrecorded in the yelling scramble to sell. There are those who believe that the true volume may
have been twenty or even twenty-five million. Big and small, insiders and outsiders, the high riders of the Big
Bull Market were being cleaned out: the erstwhile millionaire and his chauffer, the all-powerful pool operator
and his suckers, the chairman of the board with his two-thousand-share holding and the assistant bookkeeper with
his ten-share holding, the bank president and his stenographer . . . . The disaster which had taken place may be
summed up in a single statistic. In a few short weeks it had blown into thin air thirty billion dollars – a sum
almost as great as the entire cost the United States participation in the [first] World War, and
nearly twice as great as the entire national debt.
What “day” and event is Allen referring to? ____________________________________
E. Song from the past:
"I'm In The Market For You"
I'll have to see my broker
Find out what he can do.
'Cause I'm in the market for you.
There won't be any joker,
With margin I'm all through.
'Cause I want you outright it's true.
You're going up, up, up in my estimation.
I want a thousand shares of your caresses too.
We'll count the hugs and kisses,
When dividends are due,
'Cause I'm in the market for you.
Song written by George Olsen, sung by Fred MacMurray, recorded February 9, 1930
Hear it being sung: http://bss.sfsu.edu/tygiel/Hist427/427sound/Crashsound/inthemkt.wav
AP United States History - Terms and People – Unit 11, Chapter 32 (13th Ed.)
HONOR PLEDGE: I strive to uphold the vision of the North Penn School District, which is to inspire each student to reach his or her highest potential
and become a responsible citizen. Therefore, on my honor, I pledge that I have neither given nor received unauthorized assistance on this work.
Worst Stock Market Crashes Ever (based on the Dow Jones Industrial Average)
The Dow Jones Industrial Average, also simply called The Dow, is the best known US index of stocks. It
contains 30 stocks that trade on the New York Stock Exchange. It is considered a barometer of how shares of
the largest US companies are performing.
Black Monday – October 28. 1929: The Dow dropped 13%.
Black Tuesday – October 29, 1929: The Dow dropped 12%.
Black Monday – October 19, 1987: This date, now known to the world as Black Monday is
documented as the worst stock market crash in history. The Dow dropped 22.9%.
Worst Stock Market Crash Ever: 1930 – 1932
The grand daddy of them all. Investors lost 86% of their money over 813 days. This crash, combined
with the 1929 crash (#4), the 1937 crash (#2), and the 1939 crash (#8), makes up the Great
Depression.
If you had $1000 on 9/3/1929, it would have gone down to $108.14 by July 8th, 1932: an 89.2% loss.
Date Started: 4/17/1930
Date Ended: 7/8/1932
Total Days: 813
Total Loss: -86.0%
2nd Worst Stock Market Crash: 1937 – 1938
Just when investors thought the market was finally good again, following a recovery of almost half of
the Great Depression losses, the market plunged again due to war scare and Wall Street scandals.
Date Started: 3/10/1937
Date Ended: 3/31/1938
Total Days: 386
Total Loss: -49.1%
3rd Worst Stock Market Crash: 1906 – 1907
This crash was called the "Panic of 1907."
Date Started: 1/19/1906
Date Ended: 11/15/1907
Total Days: 665
Total Loss: -48.5%
4th worst stock market crash: September 1929 to November 1929
This is the crash that kicked off what we now call the "Great Depression."
Although this is the shortest market crash observed, it was a deadly one. Investors saw almost half
their money disappear in just two months. Often this crash is the worst in most people's minds.
Date Started: 9/3/1929
Date Ended: 11/13/1929
Total Days: 71
Total Loss: -47.9%
5th worst stock market crash: 1919 – 1921
This crash followed a post World War I boom (stock prices rose 51%). After the crash bottomed out in
August of 1921, this decade saw tremendous growth in the stock market and the economy (often
called the Roaring Twenties).
Date Started: 11/3/1919
Date Ended: 8/24/1921
Total Days: 660
Total Loss: -46.6%
AP United States History - Terms and People – Unit 11, Chapter 32 (13th Ed.)
HONOR PLEDGE: I strive to uphold the vision of the North Penn School District, which is to inspire each student to reach his or her highest potential
and become a responsible citizen. Therefore, on my honor, I pledge that I have neither given nor received unauthorized assistance on this work.
6th Worst Stock Market Crash: 1901 - 1903
This is the oldest crash to make the list (DJIA records are not available before 1900). To give you a
perspective of what things were like during this time, take a look at these facts:



Life expectancy in the U.S. was 47
Average wage was 22 cents an hour – avg. salary/year was about $300
Only 6% of the population had graduated from High School
Date Started: 6/17/1901
Date Ended: 11/9/1903
Total Days: 875
Total Loss: -46.1%
7th Worst Stock Market Crash: 1973 – 1974
Another long market crash -one that many people still remember (think Vietnam and the Watergate
scandal). This crash lasted for 694 days before bottoming out.
Date Started: 1/11/1973
Date Ended: 12/06/1974
Total Days: 694
Total Loss: -45.1%
8th Worst Stock Market Crash: 1939 – 1942
Although this stock market crash only took the 8th spot, it was one of the most grueling. It took nearly
3 years to recover from this crash! With WWII and the attack on Pearl Harbor, the markets had a very
tough time.
Date Started: 9/12/1939
Date Ended: 4/28/1942
Total Days: 959
Total Loss: -40.4%
9th Worst Stock Market Crash: 1916 – 1917
If the 1930s sounded like a long time ago, to find the 9th worst market crash, you have to go back to
the WWI era.
This market suffered about a 40% loss. It's difficult to break even after a 40% loss. On a $1,000
investment, your portfolio went down to $600.
Date Started: 11/21/1916
Date Ended: 12/19/1917
Total Days: 393
Total Loss: -40.1%
10th Worst Stock Market Crash: 2000 – 2002
The 10th worst market crash barely edged out the 1932 stock market crash. Being the most recent
crash, it is the easiest for us to remember. This crash required the longest recovery time of all
crashes in this list. The combination of the tech bubble bursting and the September 11th terrorist
attack served a deadly blow to the stock market, but relative to markets past, this was a minor one.
Date Started: 1/15/2000
Date Ended: 10/9/2002
Total Days: 999
Total Loss: -37.8%
AP United States History - Terms and People – Unit 11, Chapter 32 (13th Ed.)
HONOR PLEDGE: I strive to uphold the vision of the North Penn School District, which is to inspire each student to reach his or her highest potential
and become a responsible citizen. Therefore, on my honor, I pledge that I have neither given nor received unauthorized assistance on this work.
The Downward Spiral of Deflation
PROSPERITY
CRASH
Lower Prices
Loss of Paper Profits
Less Demand
Less Production
Less Employment
Less Money
in Circulation
Less Bank Credit
Less Employment
Less Building of
Factories and Homes
Less Demand
DEPRESSION
The fear of a crash of the stock market has continuously plagued
economists. Following the work of Lord Keynes, many economists now
believe that there are stabilizers in the economic system that can prevent
a major depression
AP United States History - Terms and People – Unit 11, Chapter 32 (13th Ed.)
HONOR PLEDGE: I strive to uphold the vision of the North Penn School District, which is to inspire each student to reach his or her highest potential
and become a responsible citizen. Therefore, on my honor, I pledge that I have neither given nor received unauthorized assistance on this work.
“Farm Relief”
This cartoon mocks United States President Herbert Hoover’s attempts to aid farmers during
the Great Depression of the early 1930s. It shows the president giving a farmer only a
scarecrow. The 1929 drawing is by Clifford Beryman.