The Great Depression

How The Great Depression Came The Great Depression was caused by an uneven distribution of income which led to a huge stock market crash. The uneven distribution of income was caused by workers getting very little of a company’s profit. The board game Monopoly, which first became available in 1935, became immensely popular perhaps because players could become rich—at least in their imagination. f

The Stock Market Crash In the 1920s the stock market peaked and began to fall. By 1932 the stock market was only 20% of what it used to be. On “Black Tuesday,” October 29, 1929, the market lost $14 billion, making the loss for that week an astounding $30 billion. This was ten times more than the annual federal budget and far more than the U.S. had spent in WWI. e Thirty billion dollars would be equivalent to $377,587,032, today. i

The Unemployment Rate Before the stock market crashed the unemployment rate was 3.2% and during the Depression it was 24.9%. Over 15 million people were unemployed. People who did have jobs were faced with major pay cuts The Current unemployment rate is 7.8% (Jan. 2013) l

The Banking Crisis Banks were extremely troubled by the loss of confidence in investors.Banks were extremely troubled by the loss of confidence in investors. Many people took out loans that they could never repay.Many people took out loans that they could never repay. The banks had also invested in the market which made them lose many dollars.The banks had also invested in the market which made them lose many dollars. People demanded their money back and never got it. Many banks were vandalized or destroyed by angry people wanting their money.People demanded their money back and never got it. Many banks were vandalized or destroyed by angry people wanting their money. This was later fixed by President Roosevelt (The New Deal)This was later fixed by President Roosevelt (The New Deal) l After the initial crash, there was a wave of suicides in the New York’s financial district. It is said that the clerks of one hotel even started asking new guests if they needed a room for sleeping or jumping. f

The Dust Bowl The Dust Bowl was a time of a great drought.The Dust Bowl was a time of a great drought. The Drought affected mostly the Southern PlainsThe Drought affected mostly the Southern Plains The other problem caused by the drought were dust stormsThe other problem caused by the drought were dust storms The dust storms were known as “black blizzards”The dust storms were known as “black blizzards” The Dust Bowl really was a very tough time for farmersThe Dust Bowl really was a very tough time for farmers One American sheep farmer found that he would not make money off of his sheep during the depression. Rather than watch his 3,000 sheep starve to death, he cut their throats and threw them in a canyon. d

During the Great Depression the government was expected to help get the economy out of the down fall. Government Assistance

Born 1882 Died 1945 Franklin Roosevelt was Senator in 1910 During the election of 1932 The depression had made President Hoover very unpopular there for Roosevelt won the election. In the election Roosevelt received 22,821,857 popular votes and Hoover only 15,758,901. In the electoral votes Roosevelt had 472 and Hoover had only 59. He was the 32 president of the United States He was president between He spent four terms in office which is now banned by the 22 nd amendment F.D.R.

The primary goals of the New Deal was 1. Recover from the Depression 2. Help victims of the depression 3. Recreate the economic system These were known as the “three R’s of relief, recovery and reform” On the list of problems the Banks were one of the worse. President Franklin called a “Bank Holiday” on March 9 th, 1933 This was a period in which banks closed. The day after the “Bank Holiday” more money was actually put into the bank than taken out. That was the end of the bank crisis The end of the bank crisis was the beginning of what was known as the hundred days. Since the end of the bank crisis Roosevelt Passed 15 major economy effecting laws in 100 days

Because of the massive unemployment the Government decided to become a major employer. This administration hired approximately 8,500,000 jobless people. This also benefited the government because many bridges, roads and parks were created and restored. postcards/bridges.shtml W.P.A.

This was an organization to employ skilled writers and artists This was not as big as the Works Progress Administration This only employed about 6,500 people They were paid $20 a week This organization also collected over 10,000 life stories.

FDIC This stands for Federal Deposit Insurance Corporation The FDIC was formed in 1933 as a means to insure banks. When the FDIC was first created it insured 5,000 dollars for each bank. The insurance was for if a bank closed the FDIC would pay back all investors. The current FDIC rate is $100,000 per customer.

NIRA This stands for National Industrial Recovery Act. The NRA was a part of the NIRA. The NRA created a set of codes for over 500 industries These codes helped regulate the prices of products to insure fair competition.

The Great Depression Beyond The U.S. The United States was not the only one affected. During the Great Depression most other countries were struggling. Such countries as Germany were one of the most affected. Because of how weak Germany was Hitler was able to blame Jews for the economic troubles and form the Nazi party.

After the Great Depression In 1939 the unemployment rate was 15% However in September of 1939 when Great Britain declared war the United States began spending money on building forces. In 1941 when the United States declared war industry was in high demand and so was the demand for workers.