Transcript LECTURE 01_The Stock Market Crash

UNIT 6
Chapter 22 – Crash and Depression
Chapter 23 – The New Deal
THE GREAT
DEPRESSION
Presidents of the United
States
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George Washington; Federalist (1788) #21 - …
John Adams; Federalist (1796)
Chester A. Arthur; Republican (1881)
Thomas Jefferson (1800)
Grover Cleveland; Democrat (1884)
James Madison (1808)
Benjamin Harrison; Republican (1888)
James Monroe (1816)
Grover Cleveland; Democrat (1892)
John Quincy Adams (1824)
William McKinley; Republican (1896)
Andrew Jackson; Democrat (1828)
Theodore Roosevelt; Republican (1901)
Martin Van Buren; Democrat (1836)
William Howard Taft; Republican (1908)
William Henry Harrison; Whig (1840) Woodrow Wilson; Democrat (1912)
John Tyler; Whig (1841)
Warren G. Harding; Republican (1920)
James K. Polk; Democrat (1844)
Calvin Coolidge; Republican (1923)
Zachary Taylor; Whig (1848)
Herbert Hoover; Republican (1928)
Millard Fillmore; Whig (1850)
Franklin D. Roosevelt; Democrat (1932)
Franklin Pierce; Democrat (1852)
James Buchanan; Democrat (1856)
Abraham Lincoln; Republican (1860)
Andrew Johnson; Democrat (1865)
Ulysses S. Grant; Republican (1868)
Rutherford B. Hayes; Republican (1876)
James Garfield; Republican (1880)
America: Pathways to the Present
Chapter 22
Crash and Depression
(1929–1933)
OBJECTIVES
 CORE OBJECTIVE: Analyze the causes and effects of
the Great Depression
 Objective 6.1: What were the main causes of the Great Depression?
 Objective 6.2: Describe the social problems and struggles created
by poverty during the Depression.
 Objective 6.3: How did Americans pull together to survive the Great
Depression?
 Objective 6.4: Analyze the differences between President Hoover’s
response to the Great Depression and Franklin Roosevelt’s promise
for change.
 THEME:
America: Pathways to the Present
Chapter 22: Crash and Depression (1929–1933)
Section 1: The Stock Market Crash
Section 2: Social Effects of the Depression
Section 3: Surviving the Great Depression
Section 4: The Election of 1932
When the economy…
The Market Crashes
 The market crash in October of 1929 happened very quickly.
 In September, the Dow Jones Industrial Average, an average of stock prices of
major industries, had reached an all time high of 381.
 On October 23 and 24, the Dow Jones Average quickly plummeted, which
caused a panic.
 On Black Tuesday, October 29, 1929, the stock market set a
record for loss in value
 most people sold their stocks at a tremendous loss.
 16.4 million shares were sold
 This collapse of the stock market in October 1929 is called the
Great Crash. Overall losses totaled $30 billion.
 The Great Crash was part of the nation’s business cycle, a span in which the
economy grows, and then contracts.
Effects of the Great Crash,
1929
Great
Crash
World Payments
Investors
Investors
lose millions.
Businesses
lose profits.
Businesses
and Workers
Consumer
spending drops.
Businesses cut
Workers investment
are laid and
production
production.
off.
Some fail.
Banks
Businesses
and workers
cannot repay
bank loans.
Savings
accounts
are wiped
out.
Overall U.S.
production
plummets.
Allies cannot
pay debts to
United States.
U.S.
investors
have little or
no
money to
or no
invest.
money to
invest.
Banks
run out
of money Europeans
U.S.
and fail. cannot
investments
afford
in Germany
Bank
American
decline.
runs
goods.
occur.
German war
payments to
Allies fall off.
The Great Depression
 The economic contraction that began with the Great Crash triggered the most
severe economic downturn in the nation’s history—the Great Depression.
 The Great Depression lasted from 1929 until the United States entered World
War II in 1941.
 The stock market crash of 1929 did not cause the Great
Depression.
 The Depression was the result of underlying problems
with the country’s economy.
Causes of the Depression
 An Unstable Economy
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The prosperous economy of the 1920s lacked a firm base.
 The nation’s wealth was unevenly distributed.
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Industry produced more goods than most consumers wanted or could afford.
 Overspeculation
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Speculators bought stocks with borrowed money and then pledged those stocks as
collateral to buy more stocks.
 The stock market boom was based on borrowed money.
 Government Policies
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During the 1920s, the Federal Reserve cut interest rates to assist economic growth.
 In 1929, the Federal Reserve limited the money supply to
discourage lending.
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There was too little money in circulation to help the economy after the Great Crash.
JENGA!
Social Effects of the
Depression
When the economy…
Poverty Spreads
 People of all levels of society faced hardships during the Great Depression.
 Unemployed laborers, unable to pay their rent, became homeless.
 Sometimes the homeless built shacks of tar paper or scrap
material. These shanty town settlements came to be called
Hoovervilles.
THE DUST BOWL
 Farm families suffered from low crop prices.
 As a result of a severe drought and farming practices that removed protective
prairie grasses, dust storms ravaged the central Great Plains region.
 The Great Plains, stripped of its natural soil, was reduced to
dust, became known as the Dust Bowl.
 The combination of the terrible
weather and low prices caused
about 60 percent of Dust Bowl
families to lose their farms.
Poverty Strains Society
 Impact on Health
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Some people starved and thousands went hungry.
 Children suffered from poor diet and medical care.
 Stresses on Families
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Living conditions declined as families crowded into apartments.
Men felt like failures because they couldn’t provide for families.
 Working women were accused of taking jobs away from men.
 Discrimination Increases
 Competition for jobs produced a rise in hostilities against
minorities
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Affected groups: African Americans, Hispanics, and Asian Americans.
Lynchings increased.
Aid programs discriminated against African Americans.
Social Effects of the
Depression—Assessment
What factors contributed to disaster for farming families living
in the Dust Bowl?
(A) Drought
(B) Farmers plowing under prairie grasses
(C) Decreased prices for agricultural goods
(D) All of the above
The shanty towns made up of temporary shacks were called:
(A) Roosevilles
(B) Hoovervilles
(C) Greenspans
(D) Simpson towns
Social Effects of the
Depression—Assessment
What factors contributed to disaster for farming families living
in the Dust Bowl?
(A) Drought
(B) Farmers plowing under prairie grasses
(C) Decreased prices for agricultural goods
(D) All of the above
The shanty towns made up of temporary shacks were called:
(A) Roosevilles
(B) Hoovervilles
(C) Greenspans
(D) Simpson towns