The Great Depression The Causes

Background By the late 20’s, there were signs of economic trouble Workers’ wages stopped rising Demand for goods began to drop workers were being laid off

Cause #1 - Farmers & Consumers Hit Hard First Demand for US food goes down Farmers increase production to sell more, further decreases prices Farmers can’t pay loans, rural banks fail During the Depression farmers suffered more than any group. People around the country buy less to save money

Cause #2 - Living on Credit In the 1920s too many people bought goods on credit Remember “Buy now pay later?” Many consumers begin to have difficulty trouble paying off existing debt. A huge wealth gap grew between the rich and the poor.

Cause #3 - Stock Market Crash of 1929 In the 1920s many believed that buying stocks was a quick way to get rich Speculation was popular By Sept. 1929, average stock prices were 4 times higher than in 1924 In Oct. 1929, stock prices crashed as everyone by happenstance tried to sell at once Known as “Black Tuesday” This triggered the main start of the Depression in the US

Cause #3 (cont.) - Fallout from the Crash After the crash, people panic and withdraw money from banks and close accounts Called a “run on the banks” By 1933, 11,000 banks failed 90,000 businesses went bankrupt Unemployment: 1929- 3% 1932- 25%

STOP – Mini Summary What were the 3 main causes of the Great Depression?

…Continued “Life and Times in the Depression” The Great Depression… …Continued “Life and Times in the Depression”

Depression in the Cities Many people became homeless Shantytowns- settlements made of shacks, nicknamed “Hoovervilles” Soup Kitchens & Bread Lines- offer free or low cost food; usually from charities

The Dust Bowl Many farmers exhaust nutrients from land through overproduction “Dust Bowl” - Starting in the 1930s, climate change brought drought and windstorms to the Midwest Scattered dust, sand for miles From N. Dakota to Texas hit hardest Many agricultural families migrate to California, became known as “Oakies” & “Arkies”

Dust Bowl Video Clip https://www.youtube.com/watch?v=guTek7ipD4U

Families Suffer Many men simply left their families Women took up double role of provider and caregiver. Poor diets and lack of health care lead to serious problems for children Many couples put off marriage and having children

Psychological Effects Suicide rate and admissions to mental hospitals skyrockets Financial security becomes the goal for many people Americans develop habits of saving everything.

STOP – Mini Summary Choose one….Man, woman, or child Answer this: What were the psychological effects for this person?

…Continued Hoover & the Depression The Great Depression …Continued Hoover & the Depression

Hoover’s Philosophy Hoover believes the economy will fix itself. Thought people should take care of own families, not the gov’ts job. Boulder Dam- (Hoover Dam) Created to try and help economy Provided electricity and water to 7 states Despite criticism, Hoover refused to support direct relief or welfare.

Hoover Tries Action With the 1932 Pres. Election coming up Hoover decides to try action Reconstruction Finance Corp. (RFC) Emergency funds for businesses Was the first time the gov’t got involved in the economy Was too little too late for Hoover

Bonus Army = WWI veterans go to D.C. to support the Patman Bill: would give vets bonus Bill doesn’t pass, Hoover didn’t support it About 2,000 WWI vets stay in D.C. to speak to Hoover Violence breaks out, US Army tear gases the Bonus Army Many injured, including one infant killed Public outrage over the actions of their gov’t

Full Summary … In a short paragraph, address the following. Why did it start? How did Americans feel during this time period? What role did Herbert Hoover play during this time in history?

Great Depression Group Project In teams of 4, research and describe 4 aspects about the Great Depression. 3 of you will focus on the causes, one of you will focus on life and times during it. Paragraph response for each. Decorate it with pictures symbolizing the cause. The 3 causes should be placed on the downward paths of the arrow. The 1 life/times should be written in or around the arrow tip. Use the book or notes for help.