1. THE GREAT DEPRESSION

2.  Black Tuesday – 29 October 1929  Stock market crashed in United States  Value of stocks plummeted & investors panicked and scrambled to sell their stocks  But, the more stocks they sold, the lower prices fell THE STOCK MARKET CRASH

3.  In just a few hours, the value of stocks on the world’s major stock exchanges dropped by 50 %  Millions of dollars were lost and thousands of investors went bankrupt THE CRASH

4.  During 1920s, businesses borrowed money to expand their operation  As prices dropped, lenders demanded repayment of their loans  Workers lost their jobs and could not repay their debts CAUSES OF THE DEPRESSION: EASY CREDIT

5.  In United States, there was no government regulation of financial services  1920s, banks made investments using depositors’ money  When market crashed, people ran to the bank to get their savings  With banks empty, banks went bankrupt CAUSES OF THE DEPRESSION: LACK OF FINANCIAL REGULATION

6.  Canadian economy relied on exporting staples such as wheat, pulp & paper, fish, & minerals  1920s global demand for these resources led to overproduction and flooding world markets  Demand decreased, prices plummeted CAUSES OF THE DEPRESSION: SHRINKING DEMAND

7.  United States was Canada’s most important trading partner  When the Depression crippled American economy, the effects flooded over into Canada  US companies shut down their Canadian operations, putting thousands out of work CAUSES OF THE DEPRESSION: ECONOMIC TIES

8.  Many countries imposed protective tariffs on imported goods to protect their industries from foreign competition  This meant major exporting countries like Canada had fewer markets to sell their products CAUSES OF THE DEPRESSION: PROTECTIVE TARIFFS

9. ProsperityRecessionDepressionRecovery THE BUSINESS CYCLE

10. QUEEN’S PARK, 1938