1. 3/6/2009

3. 1919-1926 Construction income doubled Modern plumbing, heating, stoves Balloon mortgages: pay interest rate, defer repayment of cost of house

4. 3/6/2009

5. 1920-1929 Auto production tripled Price of model T dropped by half to $294 Auto industry boosted & created other industries – Gas stations, repair shops – Roadside diners, motels – Fast food: White Castle

6. 3/6/2009 70% of homes wired by 1929 Modern appliances Radio: 1920—first music station Buying radios on installment ½ of all homes have radio by 1930

7. 3/6/2009 By 1929 Taxes for incomes over 1 million dropped 67% Largest 200 corporations held 20% of national wealth & 50% of corporate wealth 1/3 of families earn less that $2,000 (minimum income for decent standard of living) 1/5 th less than $1,000

8. 3/6/2009

10. Post WWI, food prices decline Increase in debts cause farmers into bankruptcy or to sell out Farm consolidation>increased capital expenditures for innovations 6 million moved from farms to cities

11. 3/6/2009 1921-1927: stocks double in value March 1928-Sept. 1929 GE stock rose from $128-400 per share Speculators bought on the margin: pay up front only 10% of purchase price, borrowed to pay the rest of cost

12. 3/6/2009

14. Campaign Slogan: A chicken for every pot and a car in every garage. Defeated Dem. Al Smith (Catholic) Hoover known as humanitarian for work in food relief for war torn Europe March 1929: Inauguration 6 months later…

15. 3/6/2009 Wed., Oct. 23 speculation bubble burst Prices began to plummet Tues., Oct. 29 panic caused prices of stocks to drop 10-20% By Nov. stock value was half of Sept. value Great Depression would last next 12 years

16. 3/6/2009 What caused the Great Depression?

17. 3/6/2009 Spending by the wealthy was not enough to keep economy going Decline in consumer spending = production 1929-33 – Shoes 3.4% – Manufactured food 17.8% – Cement 63.1% – Automobiles 65% – Locomotives 86.4%

18. 3/6/2009 Post WWI European debt & reparations American Gov’t refused to forgive or reduce European debts Excessive loans to European nations halted Excessively high protective tariff – Fordney-McCumber Tariff, 1922 – Hawley-Smoot Tariff, 1930

19. 3/6/2009 25% reduction GDP Economy to dependent on construction & automobile industry

20. 3/6/2009 Inability of borrowers (esp. farmers) to repay loans Larger Banks speculated in stock market Banks began to foreclose on loans 1930-33 9,000 banks closed their doors Panic caused runs on all banks Bank deposits were not insured Most Americans lost their life savings

21. 3/6/2009

23. High tariffs Gold Standard>controlled money in circulation Federal Reserve Board raised interest rates in 1931

24. Are we headed into another Great Depression? What are the similarities and differences between today and the Great Depression? 3/6/2009

25. Similarities Both preceded by economic boom. Both involve an unequal distribution of wealth. Banks were engaging in high risk lending/investment. Both preceded increased risky behavior in consumer finance. Both preceded by real estate bubbles and bull markets. Both global financial crises. Mortgage Foreclosures 3/5/2013

26. Differences 19292008 Drop Industrial Production51.7%14.9% Peak Unemployment35%10.2% Decline of GDP26.7%3.7% Drop in Stock89.2%53.8% # Bank Failures9000443 Loss of Bank Savings81%0% 3/5/2013

27. Most important Difference 1929 No Government Safety Net 2008 Government Safety Net FDIC Unemployment Insurance Social Security Food Stamps Medicare & Medicaid 3/5/2013

28. Complete The Photo and Music Analysis Forms 3/6/2009

29. Breadline at McCauley Water Street Mission under Brooklyn Bridge, New York 1930 3/6/2009

30. How is the Wall Street Crash of 1929 connected to the social conditions depicted in the photograph? 3/6/2009