2. Causes of the Depression Major industries barely made a profit Overproduction reduced profits for farmers Americans started buying less and/or living on credit Uneven distribution of income Speculation: buying stock at low prices hoping that it will grow Buying on Margin: buying stock on credit, paying off the stock with the profits

3. Hoover’s Solutions No Federal welfare Charities should help the poor Asked employers not to lay people off Hoover Dam: used to produce electricity, hold water, By 1930: Hoovervilles- tent cities for the poor

4. Too Little, Too Late Federal Farm Board- tried to stop overproduction Federal Home Loan Bank Act: lowered mortgage rates Reconstruction Finance Corp: $2 billion emergency financing for banks and big business

5. Big Problems Bonus Army Incident: WWI vets came to DC to ask for their bonuses Hoover asked them to leave Soldiers were told to gas the men to get them to leave.