Explain how World War One connected to the 1920s. Explain the economy of the 1920s in six words or less. From your description of the 1920s economy above; deduce how that would cause / lead to the Great Depression.
NOTES on the Great Depression
Causes of the Depression uneven distribution of wealth Stock market mistakes Speculation: buying cheap stocks hoping they will improve Buying on Margin: borrowing money from broker to buy stocks charge interest! Stock must BOOM to make any $
3. Overproduction… supply exceeds demand price drop a. Mass production = too efficient 4. Buying on Credit Farmers buy equipment on credit Prices drop Cannot pay debt Farm foreclosures!
Farms Foreclosed
5. Panic! Stock Market Crash Black Tuesday 16.4 million shares SOLD (Oct 29th, 1929) Loss of $30 billion
4. What were the causes which led to the Stock Market Crash 4. What were the causes which led to the Stock Market Crash? How did each cause create a problem for the country?
6. Bank Runs – everyone withdraws $ a. WORLD’s biggest lender falls b. Stop lending to Europe Europe cannot afford to buy American products c. Europeans cannot sell goods in US … cannot pay back war debts
Great Depression – severe economic decline Widespread poverty Factories close – 25% unemployed Hoovervilles = shantytowns for homeless gross national product (total value of goods and services a country produces) = cut in half
This photograph that has become known as "Migrant Mother" is one of a series of photographs that Dorothea Lange made of Florence Owens Thompson and her children in February or March of 1936 in Nipomo, California. Lange was concluding a month's trip photographing migratory farm labor around the state for what was then the Resettlement Administration. In 1960, Lange gave this account of the experience: “I saw and approached the hungry and desperate mother, as if drawn by a magnet. I do not remember how I explained my presence or my camera to her, but I do remember she asked me no questions. I made five exposures, working closer and closer from the same direction. I did not ask her name or her history. She told me her age, that she was thirty-two. She said that they had been living on frozen vegetables from the surrounding fields, and birds that the children killed. She had just sold the tires from her car to buy food. There she sat in that lean- to tent with her children huddled around her, and seemed to know that my pictures might help her, and so she helped me. There was a sort of equality about it. “(From: Popular Photography, Feb. 1960).
Welcome to Hoovervilles
“Prosperity cannot be restored by raids upon the public treasury”
Herbert Hoover’s response (R President) Helps business … not PEOPLE a. Opposes welfare for poor (welfare: financial support given to people in need, typically by the govt) Bonus Army - 20,000 unemployed veterans marched on Washington Want war pensions Army burns camps – use tanks and tear gas Hoover = horrified … but takes responsibility Smoot Hawley Tariff – protectionist tax on foreign goods Intended to help companies BUT, hurts producers and plummets global economy
4. Prohibition repealed (industry & jobs)
Stories of Survival Nothing was wasted the “depression generation” even those who recovered enough to live a very comfortable life, would continue to pinch pennies as if financial ruin were just around the corner People pulled together and helped one another Humor to cope “When Wall Street took the tail spin, you had to stand in line to get a window to jump out of”
What impact did the Great Depression have on the following groups of people: men, families, children, African-Americans, and Mexican Americans? What was President Hoover’s initial response to the Great Depression? Explain why he thought this. Why did his plan not work? What is a breadline? 14. What are Hoovervilles?
Dust bowl – drought and dust storms in plains states
What was the Dust Bowl? Where did the Dust Bowl occur? What created the Dust Bowl? Where did the people hardest hit by the Dust Bowl move to in order to survive? What were these people called?