1. The Wall Street Crash By: Savannah Hardiman Miranda Innis Jake Kinsel Kayla Pinson

2. Questions: ● What do YOU know about the Stock Market Crash in 1929? ● How can you compare the US in 1929 to the US today?

3. Background: The Stock Market ● Most companies raise the money they need through investors called shareholders. ● Shareholders are able to get money back by receiving a share of profit made by the company, or by selling shares. ● Successful companies usually have a share that is more valuable than the original price paid for them. ● Buyers sell and trade shares on the Stock Market ● If more people are buying shares than selling the price goes up; and if more people are selling than buying the price goes down.

4. Causes of the Crash: ● Speculation ● Weak US Economy

5. Speculation ● Investing in the Stock Market increased during the economic boom. ● People seen the stock market as an easy and quick way to get rich. ● People were able to Buy on Margin which allowed for them to put down 10% of the money on a share and borrow the rest.

6. Speculation ● In 1920 there were 4 million share owners; by 1929 there were 20 million (600, 000 of which were speculators) ● 1928- the demand for shares increased; – In march Union Carbide shares were $145 by September they were $413. ● Banks lent 9 billion out for speculating in 1929 ● 1929- People felt prices might stop rising and this resulted in more sellers than buyers...CRASH!

7. Weak US Economy ● The construction Industry began its downfall in 1926 ● In the decade before the crash over 500 banks failed each year ● Sale of consumer goods decreased because poor people couldn't afford them and rich/middle class people had already purchased items ● The US couldn't ship goods overseas because Europe put up tariffs. ● So who bought the consumer goods? No one. ● By 1929 companies spent 3 billion dollars in advertising

8. Questions: ● Based on what you know about Europe, why do you think Tariffs were put into effect in 1929? ● What do you think could have prevented the stock market crash?

9. October 29 th 1929 ● Shareholders realized the banks weren't going to intervene to help with the shares ● Speculators tried to sell 13 million shares, as a result they were sold for a fraction of a price that they paid for them

10. Political Cartoon: ● What is the cartoon trying to depict?

11. Effect on the People ● There was a loss of confidence in the stock market ● Farmers were hit hardest; the 1920s was already hard and now with farm production falling 40% they couldn't pay bills. ● Hooverville's were tiny rundown towns were people lived in huts while they looked for work. ● The rich lost the most money because they had invested the most – They were the primary buyers of consumer goods; as a result of the crash they stopped buying which caused a downturn in spending

12. Hoovervilles ● Built by homeless people looking for work ● Named after the president at the time, Herbert Hoover

13. Unemployment: ● By 1933 14 million people were unemployed.

14. Unemployment;

15. Effect on US Economy: ● Many people couldn't pay back loans because their shares were now worthless ● 1929- 659 banks failed. People began to stop trusting banks and withdrew their money. ● In 1930 1352 banks went bankrupt & in 1931 2294 banks went bankrupt ● Business's cut production, were laying off workers, or reduced wages to those still employed. ● 1933- 14 million people unemployed and 5,000 banks went bankrupt ● US trade went from 10 billion in 1928 to 3 billion in 1932

16. Video! http://www.youtube.com/watch?v=fXhLHZC2_- 4&feature=related

17. Questions: ● Do you know of anything else going on in 1929 that would affect farming? ● Why would a “loss of confidence in the stock market” have a negative effect? ● Why did banks continue to go bankrupt even after the crash? ● Why was America paying Germany loans?