1. The Great Depression “the party is over”

2. The Myth of Prosperity The roaring 20’s
A time of great prosperity for many Americans
In 1929, $4 billion spent on entertainment alone
Factories are producing more goods, but income levels stay the same
Consumers do not purchase items
Businesses cannot pay for supplies, salaries, etc.
Technology improves farming
Producing more crops then they could sell

3. The Illusion of Wealth
Consumers buying goods on credit, an arrangement to delay payment
Many acquiring large debt, risking bankruptcy
Stock market prices climbing
Rush to buy stocks, especially risky stocks to make a quick profit
Many stocks bought on “margin” or borrowed money
1920's the average cost for new cars was $240 which is about $2,696 today

4. Stock Market Crash “Black Tuesday” – October 29, 1929

5. Black Tuesday Marks the start of the Great Depression
Wall Street loses billions of dollars in that one day
Some stocks fell more than 75%
Many Americans lost their life savings in a few hours
Within months thousands of banks closed having literally run out of money

6. Cycle of Disaster
With investors ruined, businesses cannot raise capital
Capital is money used for business expenses
Factories begin to lay off workers
Workers cannot afford to buy any goods and services
By 1933 one out of every four workers is unemployed

9. The Dust Bowl
150,000 square miles of farmland damaged by dust storms
Lasted until rain finally came back and the land was rejuvenated

10. Causes of Dust Bowl A drought hit the Great Plains
Poor farming practices added to the devastation
Over farming the land destroyed the natural grasses
Winds picked up the dirt from the dry fields

11. Families packed up and left their farms to move west in hopes of finding employment
Over 2.5 million people left for California
California farms quickly became overcrowded
“The Grapes of Wrath” by John Steinbeck was a novel written about this experience

12. Get Grudged Son!
How large was the area that was affected by the “Dust Bowl” from ?
150,000 squares miles
When you didn’t have the cash, you could buy stocks by borrowing on a _______.
Margin
John Steinbeck wrote this novel.
Grapes of Wrath