1. The Stock Market Crash

2. Market Crash
Dow Jones Industrial Average – an average of stock prices of major industries.
climbing exponentially all year
September 3, all time high 381
Prices fall slowly
Wednesday, October 23
Dow dropped 21 points per hour

3. Darkness Black Thursday (October 24)
Worried investors sell, sell, sell
Government and business told people not to panic
Black Tuesday – (October 29) 16.4 million shares were sold, compared with the average 4 million to 8 million shares daily
Great Crash – collapse of the stock market
Losses totaled $30 Billion

5. Ripple Effect Initially felt by only investors Effects on Market
Risky loans hurt banks
Consumer borrowing
Bank runs
Bank failures
Savings wiped out
Cuts in production
Rise in unemployment
Further cuts in production

6. Review
What is the name of the day the stock market official collapsed?
How did the stock market eventually effect the rest of the American economy?

7. Impact
Great Depression – the most sever economic downturn in America’s history – which lasted from 1929 until the U.S. entered WWII in 1941
Workers and Farmers
Factories closed
Small businesses closed
Farm prices fell further
1932: 12 million people unemployed (25% unemployment)
GNP cut in half

8. The World All markets dependent on each other
Ordered reparation payments from WWI
Kept import tariffs and taxes high
America stopped investing in Germany
German market crashed hardest

9. Underlying Causes Unstable economy Overspeculation Government policies
Industry over-produced goods
Uneven prosperity
Overspeculation
Too many loans given to investors
Government policies
Too much money in circulation
Rapidly took money out of market in 1929

10. Learning Activity
What caused the initial start of the Great Recession?
What caused the housing market to crash in the U.S.?
What other industries were largely affected by the Great Recession?
What was the U.S. response to the outbreak of Recession?

11. Closure What is the name of the average stocks on Wall Street?
How did the crash of the stock market have a ripple effect on the American economy?
How did the Great Depression in America effect, and possibly help lead to, the depression around the world?