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The Great Depression
Chapter 14 Notes
Black Tuesday
Warning Signs:• Farm crisis• Consumers’ over reliance on credit• Stock speculation
– Bull market – Bear market– Margin buying
New York City Stock Exchange:
Black Thursday• October 24, 1929
• Lg. no. of investors (nervous about rising interest rates) began rapidly selling stocks– Stock prices dropped automatically
– Huge sell off w/ few buyers• Black Tuesday--more stocks dumped;
prices dropped more; loans called in; people go bankrupt
Wall Street
At high noon on Black Thursday, October 24, 1929, all eyes on Wall Street were turned imploringly to the House of Morgan.
Great Depression Begins:• Banks failed
– Heavy defaults, margin calls & massive w/drawals (bank runs)
• Businesses closed– Mass
unemployment (25% or more)
Great Depression Begins: • Prices dropped for farm products
– Farms lost to banks
(Continued)
• Income gap– Avg. income drops– Reduced purchasing power– Consumer debt
• Global depression – Banks call in European war loans– can’t export (European
depression)– Smoot-Hawley Tariff (highest in
U.S. history)
Hardships:• Unemployment or reduced wages
• Immigration decreased
–Migrants returned to Mexico
• Increased discrimination
Hardships:
• Malnutrition--esp. in children
• Homelessness
–Shantytowns (Hoovervilles)
–Hoboes
Families:
• Relatives helped one another
• Marriage rate fell
• Birthrates decline
• Suicide rose 28% (1929-1932)
• Feelings of guilt & shame
The Dust Bowl, 1931
The Dust Bowl
• 1931 began several years of drought
• Poor farming practices left land w/out grass
Wind storms blew away topsoil (sometimes as far as Atlantic Coast)
Dust Bowl Region: OK, KS, CO, NM, TX
The Dust Bowl
• Many people migrate west along Rt 66 to CA (promised land)
Efforts to help poor:• Salvation Army, gov. agencies, religious
groups– Mutualistas– Bread lines– Rent parties– Community rice barrels
Unemployment Offices:
Selling Apples
Breadlines and Soup Kitchens
Hoovervilles
Pop Culture:• Entertainment--means of escape
– Movies • gangsters, strong women, cartoons
– Radio • Woodie Guthrie
– Literature • John Stienbeck
Theories/Solutions:
• Business Cycle--regular ups & downs of business in a free enterprise system
• President Hoover--felt people should help themselves not the govt.
–Rugged individualism
–Associative state
Hoover Administration:Program: Actions: Effects:
Public Works Program
Public construction projects (Boulder Dam)
Failed to have much effect
Federal Farm Loan Board
Loans, co-ops, bought surplus goods
Helped some but didn’t end crisis
Reconstruction Finance Corp.
Loaned money to industry
Helped some avoid bankruptcy
Public response to Hoover
• Protests– Communists, Socialists– Scottsboro Trial– Bonus Army
• Legal action
Scottsboro Boys
Election of 1932:
• Rep: Herbert Hoover
• Dem: Franklin D. Roosevelt