Chapter 9 The Great Depression

Stock prices first began to decline in late 1929 because… Investors began to sell their stock.

_______ invested in stocks, betting that the market would continue to climb so they could make a quick profit. Speculators.

The Depression had deep roots in the economy of the 1920’s, including overproduction, high tariffs, missteps by the Federal Reserve, and The uneven distribution of income.

The stock market crash weakened the nation’s banks because… Banks had invested their deposits in the stock market.

Farmers on the Great Plains began to lose their crops during the Depression because… A terrible drought dried the soil.

During the Depression, newly homeless people put up communities of shacks they called… Hoovervilles or shantytowns.

President Herbert Hoover hoped that increasing government funding during the public works projects would.. Provide jobs lost in the private sector.

During the 1930’s, many Americans preferred movies, radio programs, and other forms of popular entertainment that… Provided a release from daily worries.

Thousands of WWI veterans came to Washington, D. C Thousands of WWI veterans came to Washington, D.C., in 1932 to lobby Congress to… Pass legislation giving veterans their promised bonuses early.

President Hoover opposed direct federal relief to the unemployment because he believed… Only state and city governments should dole out relief.

Migrants from the Great Plains heading west in search of better lives… Okies.

Set up in 1932 to allow the government to make loans to Businesses… Reconstruction Finance Corporation.

Reluctantly signed by President Hoover to supply relief funds to states… Emergency Relief and Construction Act.

Led the troops that dispersed the Bonus Army.. Douglas MacArthur.

The biggest drop of the 1929 stock market crash… Black Tuesday.

Writer who showed what characters were thinking before they spoke.. William Faulkner.

The result when the government spends more than it collects in taxes… Budget deficit.

Many depositors withdrawing their money at once… Bank run.

Painter of the 1930s who was part of the regionalist school… Grant Wood.

Stockbroker’s demand for immediate repayment of a loan used to buy stock… Margin call.

Three major root causes of the Great Depression that were at work before the stock market crash of 1929: Overproduction, buying on credit, loss of jobs; loss of export sales due to the Hawley-Smoot Tariff, Banks making loans to foreign speculators; Federal Reserve lowered instead of raised interest rates causing banks to make risky loans

Describe the art and popular culture of the 1930s, including movies, radio, literature, and visual art. Movies- comedies ,musicals, cartoons; Radio- adventure series, comedies, daytime dramas; Literature-John Steinbeck used the homeless and unemployed, William Faulkner’s “stream of consciousness” novels. Photography- Dorthea Lange showed how the Depression affected people’s lives; Paintings- of the regionalist school.

Explain how buying stocks on margin worked in the late 1920s, and describe the risks and rewards of this investment practice. Investors made a small cash down payment, the rest would be a bank loan. When the stock goes up in value, the investor sells the stock and pays off the bank loan making a profit. If the stock value drops, the bank can call in the loan at a loss to the investor and sometimes to the bank.

Describe the circumstances faced by Great Plains farmers who migrated to California during the depression. Farmers lost their lands to the banks and “Dust Bowl.” Many were known as “Okies” who traveled west looking for work in California harvesting other’s crops. They were paid very little and often lived in roadside camps and remained impoverished.