1. The Great Depression

2. What was the Great Depression? Time of economic crisis characterized by high unemployment during the 1930s, the beginning is marked by the stock market crash of 1929

3. Causes of the Great Depression Industry Agriculture Consumer spending Distribution of wealth Stock Market

4. Industry Overproduction! Demand for goods eventually declined and prices dropped

5. Agriculture Demand for farm good drops after WWI Farmers had overproduced goods throughout the 20s – low demand (low prices) Couldn’t pay off debts and eventually lost farms

6. Consumer Spending Easy credit (installment plan) = pile of debt To save $, consumers decrease their buying – hurts businesses

7. Distribution of Wealth Rich get richer (gov’t favored big business) Found wealth in new businesses (dept. stores, electrical industries, radio) Many workers couldn’t buy the goods they produced in factories

8. Stock Market

12. What IS a stock??? A share of stock is the smallest unit of ownership in a company. If you own a share of a company’s stock, you are a part owner of the company. If the company distributes profits to shareholders, you will receive a proportionate share.

13. Stock Market continued… About 1 in 20 American families invested in stocks in the 1920's. People expected to make fortunes, not realizing the risks. In the 1920’s people "bought on margin" - borrow some money to buy stock.

14. On October 29th, 1929 (Black Tuesday), stock prices bottomed out as people sold their stock for any price. Over 16,000,000 shares were sold By 1932, stocks had lost about 86% of their value

15. Review What were the 5 causes (areas of concern) of the depression? Quick definition??