Great Depression

The Election of 1928 The Republican Herbert Hoover vs. Democrat Alfred E. Smith.Hoover was elected by a large margin of

444 to 87 electoral votes.Hoover promised such things as “a chicken in

every pot and two cars in every garage.”"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."

Stock Market Increase

A Bull Market is when stock steadily rises.Many people used this time of progress in

the 1920s to invest in the stock market.People began to sell their stock and make

lots of money since the market was doing so well.

So people sold…and bought…and sold..and bought

The Stock Market boom was based on confidence….in the same way the Crash would be based in fear

Stock Market Crash

Prices falling since September, but doing ok…Monday the 21st they fell at a large rate…investors started calling stocks in on margin

October 24th 1929 is known as Black Thursday. Prices of stocks plummeted

People started getting nervous and began selling their stock.

October 29th 1929 is known as Black Tuesday. Prices dropped $10-$15 billion.

This drop in prices weakened the nations banks. People then could not borrow money.

Many people began to withdraw money from banks which forced the banks to close.

“Bank Run” at beginning of panic

Great Crash

Investors Businesse

s and Workers

Investors lose

millions.

Businesses lose

profits.

Consumer spending

drops.

Workers are

laid off.

Businesses cut

investment and

production. Some fail.

BanksBusinesses

and workers cannot

repay bank loans.Savings

accounts are

wiped out.

Bank runs occur

.

Banks run out

of money

and fail.

World Payments

Overall U.S.

production plummets. U.S.

investors have little

or no money to

invest.U.S.

investments in

Germany decline.German

war payments to Allies fall off.

Europeans cannot afford

American goods.

Allies cannot pay

debts to United States.

Great Crash

Investors

Investors lose

millions.

Businesses lose

profits.

Great Crash

Investors Businesse

s and Workers

Investors lose

millions.

Businesses lose

profits.

Consumer spending

drops.

Workers are

laid off.

Businesses cut

investment and

production Some fail.

Great Crash

Investors Businesse

s and Workers

Investors lose

millions.

Businesses lose

profits.

Consumer spending

drops.

Workers are

laid off.

Businesses cut

investment and

production Some fail.

BanksBusinesses

and workers cannot

repay bank loans.Savings

accounts are

wiped out.

Bank runs occur

.

Banks run out

of money

and fail.

World Payments

Overall U.S.

production plummets. U.S.

investors have little

or no money to

invest.U.S.

investments in

Germany decline.German

war payments to Allies fall off.

Europeans cannot afford

American goods.

Allies cannot pay

debts to United States.

Effects of the Great Crash, 1929

Great Crash Investors

Businesses and WorkersInvestors

lose millions.

Businesses lose profits.

Consumer spending drops.

Workers are laid

off.

Businesses cut investment and

production Some fail.

Banks

Businesses and workers cannot repay bank loans.

Savings accounts are wiped

out.

Bank runs

occur.

Banks run out of

money and fail.

World Payments

Overall U.S. production plummets.

U.S. investors have little

or no money to

invest.

U.S. investments in Germany

decline.

German war payments to Allies fall off.

Europeans cannot afford

American goods.

Allies cannot pay debts to

United States.

Effects on Economy

From 1930-1939 the prices of stock fell 40%.

BY 1933:9,000 banks went out of business and 9 million

savings accounts were wiped out. 86,00 businesses failed, and wages were

decreased by an average of 60%. The unemployment rate went from 9% all the

way to 25%, about 15 million jobless people.

Charities HelpPrivate charities and millionaires provided soup

kitchens and bread lines.The poor and homeless lined up to receive a free

meal.

Shantytowns and Hoovervilles

Families that could not pay rent or mortgage were forced to live on the street.

Many people built homes of cardboard, scrap metal, and lumber pieces.

Shantytowns and Hoovervilles were nicknames of “neighborhoods for homeless.”

Many people who did not want to live in a cardboard home became hobos—people who would wander from city to city jumping boxcars for rides.

The Dust BowlTo make matters worse, the Midwest

experienced the worst drought in history in 1932.

Without water for crops, many farmers could not pay their rent, and thus became hobos.

Dust Bowl -- sun dried earth from Texas to the Dakotas

Many people from Oklahoma moved west to California to work picking fruit. These people were known as Okies—migrant workers who traveled to California during the Dust Bowl era

GLOBAL EVENTUnemployed men in Canada and Germany

Government AidHoover was very much opposed to federal relief

to poor families…thought it was the job of state and local gov’s

The National Credit Corporation (NCC) – helped banks continue to make loans to individuals….was created to help banks continue making loans to people.

The Reconstruction Finance Corporation (RFC) loans to railroads and agriculture. By 1932, the RFC had given away $238 million.

The Emergency Relief and Construction Act gave $1.5 billion for public works and $300 million to states for loans.

Hunger Marches

The American Communist Party was eager to take advantage of the crisis.

January 1931, 500 men and women looted a grocery store in Oklahoma City.

December 5th 1,200 people held a hunger march in Washington DC. they were chanting “feed the hungry, tax the rich.”

Many more hunger marches were held in the U.S.

Farmers RevoltBetween 1930 and 1934 nearly 1 million

farms were foreclosed on and the people were evicted

Farmers began destroying crops to cut supply and drive up the prices

Farmers in Nebraska heated their homes by burning corn

Georgia dairy farmers would block the highway, stop dairy trucks, and dump the milk into ditches

Bonus ArmyIn May of 1932, about 1,000 WWI veterans began to

march toward Washington DC. to try and pass legislation to have their bonuses paid early

They were supposed to receive $1,000 in 1945, they needed it now

As they passed towns more veterans joined in.They wore their old military uniforms and sang war

songs.Their numbers grew to about 17,000. This was known

as the Bonus Army.Totaled 43,000 marchers including their families and

supportersThey found places to stay in shantytowns or abandoned

buildings.

Bonus Marchers continued

House passed the vote to give them $, Senate rejected it, and things grew more tense

President Hoover ordered them to leave. The police were first responsible for making them

leave…two protesters are killed… Federal Army called in to restore order… two veterans

were shot and killed... MacArthur leads the Calvary on horses, Patton leads

the tanks, Eisenhower is liaison with the police They began to tear gas the crowd until everything

calmed down. A women and her two babies die. The mishandling of these WWI veterans would tarnish

Hoover’s image forever.