1. Warm-up: Why do you think the US economy boomed after the war ended?
People had money to spend after the war because there was nothing to buy during the war
Production went up in consumer goods but supply was short
New technologies allowed new consumer goods to hit the market

2. The Economy of the 1920s

3. The Model T Before 1920, only wealthy people could afford cars.
Ford made the Model T affordable by applying mass production techniques.
Ford consulted scientific management experts to make his manufacturing process and the assembly line more efficient.
The time to assemble a Model T dropped from 12 hours to just 90 minutes.
Also raised workers’ pay & shortened their hours. 3

4. How the Automobile Changed America
As a result of the boom in auto industry, new roads were built
Road construction boomed, and new businesses opened along the roads.
Other car-related industries included steel, glass, rubber, asphalt, gasoline, and insurance.
Workers could live farther away from their jobs.
Families used cars for leisure trips and vacations.
Fewer people traveled on trolleys or trains.

6. The 1920s also saw a consumer revolution.
Consumers had a new method of buying—credit—installment plan (installment buying)
The 1920s also saw a consumer revolution.
Using installment
buying, people could buy more.
New products
flooded the market.
Advertising
created
demand.
Buy now pay later caused the economy to grow 6

7. Advertising and Consumption
Grew with automobile industry
Billion dollar industry
New way to introduce modern technological products (washing machines, radios, vacuum cleaners, etc.)
Enticed consumers to spend money they did not really have...Led to mass consumption of items not considered necessities

8. The Stock Market
Throughout the 1920s, a bull market meant stock prices kept going up.
Investors purchased stocks on credit—buying on margin
Remained profitable as long as stock prices rose.
Rising stock market prices also contributed to economic growth.
By 1929, around four million Americans owned stocks.

9. More and more people who worked in cities moved to the suburbs.
Suburbs grew faster than inner cities.
Cities and suburbs benefited from the economic boom.
Cities expanded outward, thanks to automobiles and mass transit systems.
Immigrants, farmers, African Americans, and Mexican Americans were among those who settled in urban areas.

10. Farm incomes declined or remained flat through most of the 1920s.
Falling prices and massive debt from wartime borrowing hurt farmers.
Farmers definitely did not share in the prosperity of the 20s.