Was the Great Depression of the 1930s inevitable (expected)?

How do these two pictures differ?

How do these two pictures differ?

What is a Depression? A time when the economy fails to grow and many people are out of work

Overproduction and Under consumption : Factories and farms produced a lot more goods than people were buying Workers income did not keep up with the prices of goods, so they could not afford to buy many goods

Government Policies U.S. had high taxes on imported goods European nations were suffering from WWI and did not have money to buy U.S. products

Dust Bowl 1931 Great Plains Drought- no water 1939 dust storms- Dust Bowl Unlivable conditions Millions of acres of farmland damaged

Unequal Distribution of Wealth Very Few Americans were rich 1% of Americans owned all property and goods The rich saved their money Middle class were in debt from buying many good (cars, refrigerators, etc.) so they could not buy anymore

Weakness in the Banking System Banks made unwise loans lent money to people who invested in the stock market who took risks 1929-Stock market crashed borrowers could not repay their loans Banks were forced to close 5,000 banks closed between 1929-193 Americans life savings disappeared overnight

When everyone wants their money all at the same time, a problem comes up (The Crash—Black Tuesday and Thursday).

The Crash-Black Tuesday and Thursday What were people doing on this day? When was it finally over? October 24, 1929- Black Tuesday Hundreds of people began widely selling their stocks-Panic October 29, 1929-Black Thursday

Streets the day the NY stock market crashed

A crowd gathers outside New York’s American Union Bank during a bank run in 1931.

When the crash happened, many people suddenly were without jobs When the crash happened, many people suddenly were without jobs. They now had to look for work or free food.

Summary of Causes of Great Depression: The Great Depression did not happen overnight and not one single event caused for it to happen. The Great Depression was caused by a whole bunch of factors. These factors included: Deflation—money is not worth as much as it used to be. Decline in trade—if no one is buying goods from the U.S., then the U.S. cannot make money. Banks operated without any guarantees to their customers, creating panic amongst people when times got tough. Few regulations were placed on the banks—banks lent money to those who were irresponsible and took gambles in risky stock investments. People’s wages stayed the same even as product prices increased. Factories and farms stilled continued to produce goods at the same rate, but the demand for their products was decreasing. Agricultural (farming) prices were already low during the 1920s, which made it hard to farmers to recover. The richest one percent of Americans owned over a third of all American assets (property, goods, etc.)—wealth that is in the hands of very few Americans limits economic growth. The wealthy saved their money. The middle class already were in debt by purchasing automobiles and house hold appliances on installment plans (paying for goods over a

The Elderly No services for the aging in America No work or money Government did not provide services No retirement funds

African Americans Had little opportunities before The Great Depression 1932- 50% of African Americans were unemployed

Unemployment Businesses went bankrupt Unemployment soared in the 1930s 1 in every 4 workers was jobless Millions of workers shortened hours or took pay cuts Jobless lost their homes

Human Cost Families suffered Marriage and birth rates dropped Hungry parents and children searched through city dumps and restaurant garbage cans

Hungry Americans waiting in line for food during the Great Depression

Unemployment line in New York City

President Hoover Responds Did not believe that the government should become directly involved in helping to end the business Opposed government relief programs Called on private charities to set up soup kitchens Set up public works programs Hire workers to build schools, construct damns, and pave highways

Hoovervilles Americans blamed President Hoover for doing very little Americans gave the name “Hoovervilles” to the shacks where homeless lived.

Results of the Crash Many people lost their jobs Businesses and banks closed due to lack of money People lost their lives Hoovervilles By 1932, ¼ of all workers were out of jobs

Summary President Hoover did nothing to help the American people. The government knew something had to be done. Finally, there was an election year. How can an election year help a country in trouble?