The Great Depressionand

The New Deal

“I have no fears for the future of our country...it is

bright with hope.”Herbert Hoover

“This nation asks for action, and action now.”

FDR

Causes of the stock market crash in October

1929:

Causes of the stock market crash in October

1929:•Overproduction

•Under consumption

•Over optimism about the economy

•Speculation

•“Buying on the margin” led to bank failure

Consequences of the crash?

• Banks fail

• Unemployment

• World wide depression

Why was Hoover blamed for the crash?

•Didn’t believe the federal government should get involved in the economy•supported only private and local relief efforts

What were the basic purposes of the New Deal?

Relief for victims of depression

Recovery from depression

Reform for the economic system

How did the New Deal work to strengthen the monetary

system?

Emergency Banking Relief Act

Federal Deposit Insurance Corporation

What kind of relief measures were taken by the New Deal?

•PWA

•TVA

•CCC

•AAA

•WPA

•SEC

How were these suppose to “Prime the Pump”?

People get money

Spending creates demand for goods

Stimulates production & jobs

People get money