 An average of 600 banks failed each year  Agricultural, railroad, and coal mining sectors were continually depressed  Value of farmlands fell 30-40% between  Organized labor declined throughout the decade

 ‘Technological unemployment’ enters the nation’s vocabulary 200,000 workers replaced by machinery each year  By 1929, only 200 corporations controlled over half of all American industry  By 1929, the richest 1% owned 40% of the nation’s wealth  The middle class comprised only 15-20% of all Americans BIG gap between rich and poor

 Chart ~ page 369  Wages did NOT increase at the same rate as companies’ profits  Purchasing power in the top 10% of the nation’s population Couldn’t buy enough to keep the country booming

 Low incomes  Expanding production

 Debt from WWI  Overproduction + lower demand = low prices  Low purchasing power

 Change in American mentality “Go into debt to achieve the American dream”  Stock market speculation (i.e. gambling)  Too much debt Eventually led to decreased spending

 Foreign nations could not afford American goods War debts Reparations payments

 Over-speculation  Stock Market Crash – October 1929 Represents the Business Cycle (pg 368) “What goes up, must come down”  Began spiral effect that led the United States into severe depression

 Federal Reserve (“The Fed”) limited the amount of money in circulation  Banks collapsed (pg 374)  Businesses closed (pg 374)  Unemployment skyrocketed (pg 375)  Hawley-Smoot Tariff Act  Depression went global Led to cycle of poverty and political instability

 Distrust of government (Hoover)  Rise of radicalism (socialism, communism, fascism)  Violence  Escapism in pop culture  Shift from pro-business to anti- business  Dislocation of families  Uncertainty, despair  Weakened U.S. foreign policy – no economic power

 Rise of centralized, powerful government  Regulation of stock market, banks, and economy (managed economy)  Democratic party as majority party ( )  Shift of power from Congress to the Presidency  Rise of labor unions  Legacy of fear of banks and business