The Great Depression EQ: What caused the Great Depression? EQ: What was life like during the Great Depression?

Stock Market Crash

Yesterday’s NYSE Composite Index spanning the past year.

The Crash Beginning in Oct. 1929, investors’ confidence dropped, leading to a market collapse All tried to sell at once and the bottom fell out Black Thursday Black Tuesday

Only a tiny minority of people traded on the stock exchange, but they possessed vast wealth, and the crash had a ripple effect on the economy

PRODUCTIVITY AND UNEMPLOYMENT During the 1920's U.S. Economy was based on the employment cycle For many goods to be produced, purchasing demand had to be there: ▫This resulted in high employment and a healthy economy U.S. productive capacity doubled but it was b/c of technological innovation ▫Electricity and mechanical advances made for better production, but no new jobs were added to the economy So more consumer goods were available, but there weren't more people to buy them (OVERPRODUCTION)

Distribution of Wealth 2nd major problem: uneven distribution of wealth ▫0.1% at top owned as much as bottom 42% ▫58% above the poverty line, most fell into the middle class category - they were not wealthy; they had jobs b/c of the industrialization & consumerism

Middle Class woes The middle class depended on their salaries, so when productivity declined they lost their jobs Because of low savings, they had to cut back on their purchases The decline in consumption among the middle class ruined the economic prosperity of the country

Purchasing Power Unemployment Productivity Unemployment Cycle

Tariffs Democrats in Congress passed a high tariff (SMOOT HAWLEY) to protect U.S. industry (hoped to stimulate purchasing of U.S. goods) In retaliation other countries passed high tariffs and no foreign markets purchased American goods, so U.S. productivity decreased again

Banking System Companies could not pay back their loans People could not pay back their loans Banks lost money they invested Banks went out of business The U.S. Banking system collapses People Lost Everything!

Urban Life Sub EQ: What was life like during the Great Depression in urban areas?

Many waited in unemployment lines hoping for a job…

Bread Lines People in cities would wait in line for bread to bring to their family…

Freezing, desperate, and without hope…

Many were forced into shantytowns or HOOVERVILLES…

Hooverville

Some were simply homeless…

Rural Life Sub EQ: What was life like during the Great Depression in rural areas?

A drought in the South lead to dust storms that destroyed crops

The Dust Bowl Crops turned to dust=No food to be sent out Homes buried Fields blown away South & Mid-West in state of emergency Dust Bowl the #1 weather crisis of the 20th century

The Soil was gone…

Two Families during the Depression

Popular Culture during the Depression Sub EQ: What cultural enjoyment did people find during the Depression?

Movies stars…

The Marx Brothers, Duck Soup, 1933

Orson Welles, “ War of the Worlds, ” 1938

The Election of 1932 Republican ▫Herbert Hoover Democrat ▫Franklin D. Roosevelt  Former Governor of New York

FDR Skillful and intelligent Wealthy family ▫Distant cousin of Teddy Roosevelt ▫Married Teddy’s niece Eleanor Roosevelt Hit with Polio in 1921 ▫Overcame the disability

FDR’s Stance during the election… THE DEPRESSION ▫FDR attacks Hoover’s actions ▫Called for a complete change in policy ▫Full government involvement  Many policies coming. ▫Would this work?

YEP!