The Stock Market Crash, the Great Depression, and the New Deal

What was the Great Depression? Period of severe economic hardship that lasted from 1929 to World War IIPeriod of severe economic hardship that lasted from 1929 to World War II

What were three causes of the Great Depression? Overspeculation in stocksOverspeculation in stocks Collapse of the banking systemCollapse of the banking system Hawley-Smoot TariffHawley-Smoot Tariff

What is speculation ? Buying something at a low price in the hope of selling it later at a profitBuying something at a low price in the hope of selling it later at a profit

What is the largest stock market in the United States? The New York Stock ExchangeThe New York Stock Exchange

What does it mean to buy stock on margin? Buy stock on creditBuy stock on credit

What event triggered the Great Depression? The Stock Market CrashThe Stock Market Crash

What functions as the central bank of the United States? The Federal Reserve SystemThe Federal Reserve System

What acts as a banker’s bank? The Federal ReserveThe Federal Reserve

What controls the nation’s money supply? The Federal ReserveThe Federal Reserve

What is inflation? When prices increase and the dollar buys lessWhen prices increase and the dollar buys less

What does the Federal Reserve do to stop inflation? Raises interest ratesRaises interest rates

The Federal Reserve’s power to set ________ ______ enables it to control the nation’s money supply? Interest ratesInterest rates

What does the Federal Reserve do if it believes the economy is overheating and causing inflation? Raises interest ratesRaises interest rates

What does the Federal Reserve do if it believes the economy is slowing down? Lowers interest ratesLowers interest rates

What is a protective tariff? A tax on imports that is so high that Americans cannot afford to buy foreign goodsA tax on imports that is so high that Americans cannot afford to buy foreign goods

What was the Hawley- Smoot Tariff? Protective tariffProtective tariff The highest tariff rates in historyThe highest tariff rates in history

The Hawley-Smoot Tariff was supposed to help American business. Why did this tariff law hurt the American economy?

Foreign countries retaliated by passing high tariffs of their own.Foreign countries retaliated by passing high tariffs of their own. This meant foreigners could no longer afford to buy American- made goods.This meant foreigners could no longer afford to buy American- made goods. The decrease in foreign sales was greater than the increase in the sale of American-made goods within the United States.The decrease in foreign sales was greater than the increase in the sale of American-made goods within the United States.

What were five effects of the Great Depression on the United States?

Unemployment increasedUnemployment increased Banks closedBanks closed Consumer demand for goods droppedConsumer demand for goods dropped Political unrest increasedPolitical unrest increased Farm foreclosures increasedFarm foreclosures increased

What was the unemployment rate among Americans by 1932? 25%25%

Who was president when the Great Depression began? Herbert HooverHerbert Hoover

What was Herbert Hoover’s political party? RepublicanRepublican

What president started the New Deal? Franklin D. RooseveltFranklin D. Roosevelt

What was Franklin Roosevelt’s political party? DemocratDemocrat

What was President Franklin Roosevelt’s program to end the Great Depression? The New DealThe New Deal

Who said, “The only thing we have to fear is fear itself?” RooseveltFranklin D. Roosevelt

What the three R’s of the New Deal? ReliefRelief RecoveryRecovery ReformReform

What is reform? Change for the betterChange for the better

What was the purpose of the New Deal “relief” programs? Ease the suffering of the unemployedEase the suffering of the unemployed

Give an example of a New Deal “relief” program. WPAWPA

What did WPA do? Paid people to work on public works projectsPaid people to work on public works projects

What are public works projects? Construction projects paid for by the governmentConstruction projects paid for by the government Benefit everyoneBenefit everyone

Give examples of public works projects.

RoadsRoads SchoolsSchools BridgesBridges Post officesPost offices ParksParks LibrariesLibraries DamsDams

What was the purpose of the New Deal “recovery” programs? Help Business RecoverHelp Business Recover

Give an example of a New Deal “recovery” program. AAAAAA

For what did AAA stand? Agricultural Adjustment AdministrationAgricultural Adjustment Administration

What did AAA do? Paid farmers not to raise crops and livestockPaid farmers not to raise crops and livestock By limiting supply, tried to raise livestock and crop pricesBy limiting supply, tried to raise livestock and crop prices

What was the purpose of New Deal “reform” programs? Bring about change for the better in American societyBring about change for the better in American society

Give two examples of New Deal “reform” programs. FDICFDIC Social SecuritySocial Security

For what does FDIC stand? Federal Deposit Insurance CorporationFederal Deposit Insurance Corporation

What does FDIC do? Deposits at FDIC-insured banks are now insured up to at least $250,000 per depositor through December 31, 2013Deposits at FDIC-insured banks are now insured up to at least $250,000 per depositor through December 31, 2013

What did the Social Security Act provide? Unemployment insuranceUnemployment insurance Old-age pensionsOld-age pensions

What brought an end to the Great Depression? World War IIWorld War II

What is another name for organized labor? UnionsUnions

Were labor unions active during the Great Depression? YesYes

What three rights did workers gain during the New Deal? Right to form a UnionRight to form a Union Right to StrikeRight to Strike Minimum WageMinimum Wage

Since the New Deal, who do Americans hold responsible for bringing prosperity to the U.S. economy? The federal government, especially the PresidentThe federal government, especially the President