1. The Great Depression Ch 15

2. The Crash Until mid-September, 1929, market prices rose beyond real value of stocks. Prices began _______________________. Late October, prices began to fall faster as investors began to sell. Banks bought all the stock they could to stabilize market, but only ________________. ________________________________-16.4 million shares by investors in effort to get their money out of market. – ______________________ dropped stock prices to fractions of original value.

3. Market declines are normal part of ________ ______________. – Period in which economy _____________________________________. Market crash only hurt big investors at first. – Spread to affect all aspects of society.

4. Why Depression Spread – ___________________________-Debtors couldn’t pay back loans, banks lost money. – ___________________________-Consumers borrowed money, couldn’t pay it back. – __________-People rushed to withdraw $$ before banks closed. Banks called in loans, people couldn’t pay. – _________________-Banks ran out of money, closed. – _________________________-People lost savings when banks closed. – _________________________-No reason to produce when businesses couldn’t get loans and nobody was buying. – __________________________-Business cut back, laid off workers.

5. ______________________ began with Great Crash. – Most severe economic downturn in nation’s history. Factories ____________________, closed due to lack of demand for products. – Led to closing of small local businesses (ex- restaurants). Farm prices dropped. By 1932, __________________ of all American workers was unemployed.

6. All world banks & markets were ___________. – When largest economy (USA) collapsed, all crashed. – ____________________ could not pay war debt. – ___________________ could not pay back loans to USA. – High tariffs limited foreign sales in USA markets.

7. Social Effects of Depression Banks closed, __________________________. Unemployed, couldn’t pay rent, evicted. Many homeless built __________________ in parks, vacant lots. – ____________________ made of scrap material. Many became _______________, travelling country on rails looking for work. Farmers who couldn’t pay mortgages lost farms to banks.

8. The _________________ Many farmers over-farmed their land, trying to make profit. – Plowed up grass holding soil down. Several years of drought and wind led to huge _______________________. – Called ______________________. – Millions of tons of ______________ blew away, landed as far away as middle of Atlantic Ocean. Midwestern farmers abandoned farms, migrated to California, looking for work. – Called “__________”.

9. Survival in the Depression People did what they had to to survive. – Took ________________________________, hitchhiked around country looking for work. People banded together to help each other. – When banks sold farms at auction, farmers would bid pennies on the farms, then return it to the farmers. Called ______________________________. – Led many states to forbid farm ___________________.

10. Many young men _______________________ around USA looking for work. – Often, families couldn’t afford to keep them. – Called _______________. Riding rails was dangerous-injury, death, ________________, beatings, robbery. Even in bad times, people had sense of humor. – Slept under “__________________”-newspapers. – Waved “_________________”-pockets inside out. – Lots of cartoons in newspapers.

11. There were some positives. – Feb. 1933-______________________ passed- repealed Prohibition. – 1930-__________________________ began construction of ___________________________. Tallest building in world for a time. 102 stories (1,250 feet) tall. Seen as symbol of hope for people.

12. Hoover during the Depression Hoover originally insisted gov’t should not get involved. Asked businesses to maintain _____________. – Did at first, but eventually had to begin cutting. Hoover realized people needed help, began job programs-_______________, roads, parks. Passed ___________________________- highest import tariff ever. – Hoped to protect USA business; backfired, Europe raised tariffs, slowed USA international business.

13. Created ______________________________ __________-gave credit to large companies, loaned $$ to banks. – Did not help small business, _________________. Hoover believed relief should come from state/local gov’t. – Federal relief would destroy _________________, create more gov’t. People felt Hoover ____________________, blamed him for all problems.

14. Summer 1932-20,000 WWI vets camped in Washington, DC. – Called themselves the ____________________. – Wanted their _________________________ early. Hoover called in General _________________ ______________ & army to clear out protestors. – MacArthur used force to drive out protestors, many injured. Hoover blamed.

15. _______________________________ Democratic Party nominee for president. Governor of _________________ 1929-1932. FDR was willing to try anything to help pull USA out of Depression. Promised USA a “_____________________”. Supporter of __________________________. – In times of economic trouble, gov’t spending can make up for lack of private/business spending.

16. 1932 Election Hoover campaigned on idea that FDR’s policies would ______________________ size & power of gov’t. FDR campaigned on idea that Hoover’s policy of doing ______________________, and gov’t must step in and help. FDR won by ___________________________; huge margin. FDR would begin massive redesign of US gov’t.