Causes of the Depression

BLACK TUESDAY – start of GREAT Depression BLACK TUESDAY – start of GREAT Depression Happened because of little Govt. regulation –Laissez Faire Economics Happened because of little Govt. regulation –Laissez Faire Economics HIGH TARIFFS – Foreign made products entering the USA cost more, so that AMERICANS would buy USA products only. HIGH TARIFFS – Foreign made products entering the USA cost more, so that AMERICANS would buy USA products only. Backfired – Foreigners in retaliation did not buy our products & put TARIFFS on USA GOODS. Backfired – Foreigners in retaliation did not buy our products & put TARIFFS on USA GOODS.

Many cause contributed to making the Great Depression as severe as it was Farm Depression of the 1920s Prices of farm products felled about 40% in and they remained low through the 1920s As results some farmers lost so much money they couldn’t pay the mortgage on their farm Uneven Distribution of Income Industrial productions increased about 50% but the wages of the industrial workers rose far more slowly As results these workers couldn’t buy goods so fast as industry produced them The Stock Market Crash Stock values dropped rapidly on Oct. 24,1929; now known as Black Thursday On Tuesday stock holders panicked and sold a record ,030 shares of stocks Thousands people lost huge sums of money as stock values fell far blow the prices paid for

Banks lost money on their investments, and investors defaulted on loans. Because the government did not insure bank deposits customers lost their money if/when a bank closed. Bank RUNS resulted as many bank customers withdrew their money at the same time, causing the bank to collapse and close for business.

List and explain your 7 principles of gov’t. List and explain your 7 principles of gov’t.

Causes of the Depression

The Depression Starts

President Hoover believed that business if left alone to operate without government supervision would correct the economic conditions! Reconstruction Finance Corporation Congress approved Hoover’s most successful anti-depression measure Reconstruction Finance Corporation lending money to banks, railroads, and other large organization whose failure would have made depression even worse This government agency provided some relief by lending money to banks, railroads, and other large organization whose failure would have made depression even worse

Question Question: How many people were unemployed in 1925? In 1929? In 1932?

Hoover did increase PUBLIC WORKS – government-financed building projects to replace construction jobs that had been stopped. Hoover did increase PUBLIC WORKS – government-financed building projects to replace construction jobs that had been stopped. At the same time, Hoover refused to increase government spending or taxes. At the same time, Hoover refused to increase government spending or taxes. He feared deficit spending would actually delay an economic recovery. He feared deficit spending would actually delay an economic recovery.

Unemployed workers often stood in BREAD LINES to receive free food or at SOUP KITCHENS where private charities gave a free meal to the poor. Many of the homeless built shacks in SHANTYTOWNS, which they called “HOOVERVILLES”, because they blamed the President for their troubles. HOBOS, or homeless Americans who wandered around hitching rides on railroad cars, searched for a better life and WORK.

Homeless Americans blamed President Hoover for their predicament. Homeless Americans blamed President Hoover for their predicament. Many homeless people wrapped themselves in used newspapers they called “HOOVER BLANKETS” to keep themselves warm. Some wore their empty pockets inside out and called them “HOOVER FLAGS”. Many homeless people wrapped themselves in used newspapers they called “HOOVER BLANKETS” to keep themselves warm. Some wore their empty pockets inside out and called them “HOOVER FLAGS”.

2008 GREAT DEPRESSION

2000s 1930s

FARMERS

As crop prices dropped in the 1920’s, many American farmers left their fields uncultivated. As crop prices dropped in the 1920’s, many American farmers left their fields uncultivated. A terrible drought in the GREAT PLAINS, beginning in 1932, caused the region to become known as a “DUST BOWL”. A terrible drought in the GREAT PLAINS, beginning in 1932, caused the region to become known as a “DUST BOWL”. That resulted in many Midwestern farmers and Great Plains farmers lost their farms. Many families moved west to CALIFORNIA hoping to find a better life That resulted in many Midwestern farmers and Great Plains farmers lost their farms. Many families moved west to CALIFORNIA hoping to find a better life

The Dust Bowl