Boom to Bust

Thursday, October 24, 1929, Page 1, Col. 1PRICES OF STOCKS CRASH IN HEAVY

LIQUIDATION, TOTAL DROP OF PAPER LOSS $4,000,000,000

----------2,600,000 Shares Sold In The Final Hour In Record

Decline----------

MANY ACCOUNTS WIPED OUT----------

Bankers Confer On Steps To Support Market - Highest Break Is 96 Points

Wall Street on Black Thursday

Black Tuesday

• October 29, 1929• Stock Market Crash

• Americans tightened their belts which contributed to the depression

GREAT DEPRESSION

Causes of the Great Depression

1. Demand for goods declined, which caused industrial output to slow

2. Overuse of credit

3. People bought real estate and stock in hopes of selling it quick for money

Stock PricesCompany 3/3/28 9/3/29

American Can 77 181

AT&T 179 304

General Electric 128 396

Montgomery Ward 137 466

Union Carbide 145 413

• Investors bought on margin – paid only 10% at first and borrowed the rest

Ticker tape machine

The Depression

• Run on Banks – people withdrew all their money causing the banks to run out of money and they had to close

• Unemployment – 1 out of every 4 workers were unemployed

Hoovervilles

• Cardboard shacks sheltering homeless people

Hoover blankets

• Newspaper used for covering on cold nights

Hoover flags

• Empty pockets turned inside out

Dust Bowl

• Huge dust storms on the Great Plains• Caused “black blizzards”

President Hoover’s Plan

• Hoover didn’t believe in a dole (or handout)• Wanted people to work for their money• Also wanted to try to keep the US budget

balanced

• Reconstruction Finance Corporation– Loaned $2 billion to businesses for projects and to

employ more people

Bonus Army

• Group of WWI veterans who were promised a bonus who wanted it early

• Douglas MacArthur was sent in to get rid of the army