great depression election of 1928 herbert hoover republican candidate alfred smith democratic first...
TRANSCRIPT
GREAT DEPRESSION
GREAT DEPRESSION
• Election of 1928• Herbert Hoover Republican
candidate• Alfred Smith Democratic • First Catholic to run for
President
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• Herbert Hoover Republican
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• Alfred E Smith Democrat
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• Hoover’s Campaign promise
• “Chicken in every pot and a car in every garage”
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• Hoover wins in a landslide
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U. S. Still in prosperity but cracks are showing
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•Easy Credit
•Over production of inventory
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• Economy was strong based on World War I
• Installment buying
• Dollar down
• dollar a week
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• Made it easy for all to buy
• Repossessed if payments were missed
• Stock Market opened to all Americans
• Some were novice
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• Speculation
• Margin
• Buyer puts 10% down on a stock
• Broker provides rest as a loan or margin
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• Buyer gambles that stock is going to increase
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• If price fell broker called in margin demanded immediate payment
• Usually investor or buyer lost everything
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• BUBBLE BURSTS
• October 29, 1929
• “Black Tuesday”
• Stock prices plummeted
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• 29th and 30th 16 million shares were sold
• By two weeks time index price fell by 50%
• 30 billion dollars were lost in the next weeks
GREAT DEPRESSION
• Unsound banking practices led to:
Speculation
risky loans
fake investment schemes
CAUSES OF GREAT DEPRESSION
• Credit
• Too much
• People and banks suffered
• People could not pay
• Banks lost money
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• Not all lost some gained tremendously
• Joseph Kennedy Sr. allegedly
• Got inside information and sold before the market crashed
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• Agriculture
• Depressed for years
• Overproduction caused low prices
• Agriculture Marketing Act
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• Established loans to farmers • Federal Farm Board• Purchased surplus crops• Could not limit production• Depression in Europe closed a
market for surplus food
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• Depression was world wide
• Smoot-Hawley Tariff
• High tariffs on imported goods to protect U S goods
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• Foreign countries flooded market
• Prices continued to fall
• Farmers continued to grow crops
• Prices plummeted depression worsened especially for farmers
GREAT DEPRESSION
• Banking and Finance
• Federal Reserve Board was urged to regulate credit and speculation
• They did nothing
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• Deposits shrank
• Massive withdrawals
• Holidays were declared in Nevada, Louisiana Michigan
• Emergency credit pool for relief
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• Bankers formed National Credit Corporation
• Failed to help situation
• Fearful that loans would jeopardize their banks
CAUSES OF GREAT DEPRESSION
• Few basic industries
• No diversification–2 major industries
• Construction
• automobile
CAUSES OF GREAT DEPRESSION
• Uneven distribution of wealth
• More than one half of Americans lived on edge of poverty
CAUSES OF GREAT DEPRESSION
• International debt
• Europe could not pay back loans to United States from World War I
• High Tariffs on American goods
• Europe responded with the same high tariffs on American goods
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GREAT DEPRESSION
• All failed
• Reconstruction Finance Corporation (RFC)
• Jan 1932
• Provided loans to banks
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• Railroads • Life insurance• Farm Mortgage assistance• It did ease the banking crisis • January 1932 346 banks failed • April 46 failed
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• Unemployment Relief Organization
• Stimulate private charities
• 3 other major measures were passed by Congress
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• 300 million dollars were allocated to help liquidate banks loans for public works
Loans to states to help in public projects
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• 30 million allocated
• Too cautious (RFC) to help
• None for Public Works
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• Hoover would not direct aid to unemployed
• Private Charities
• Opposition to direct relief
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• Cemented his reputation as doing nothing to ease depression
• Shack villages were called Hooversvilles
Herbert Hoover
• Newspapers wrapped around people were called Hoover Blankets
• Broken down cars were called Hoover wagons
• Pockets turned inside out were called Hoover Flags
GREAT DEPRESSION
• BONUS MARCH 1932• Hunger Marches and unemployed
rioted• Bonus Expeditionary Force (BEF)• World War I veterans were able to
borrow against life insurance in 1945
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• Technically it was not a bonus
• Veterans wanted the money now
• Needed the money for necessities
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• Congress could not afford payments
• Yet they appropriated $100,000 for the marches return home
• ½ took offer
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• Others occupied buildings to be knocked down for public work projects
• July 28, 1932 police tried to evict squatters
• 2 veterans killed stalemate continued
GREAT DEPRESSION
• General Douglas McArthur had orders to move vets
• He took it upon himself to drive them farther than President Hoover ordered
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• McArthur along with junior officers Patton and Eisenhower
• Used tanks guns and tear gas to remove veterans
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• McArthur disobeyed orders to stop
• Hoover while upset did nothing to stop McArthur
• Reinforced Hoover’s image as a do nothing President
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• ELECTION OF 1932
• FDR Franklin D. Roosevelt
• Elected President
• New outlook for United States