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Guided Notes The Roaring Twenties & the Great Depression The U.S. Economy in the 1920s At the end of World War I, the U.S. was the worlds leading economic power. This position grew stronger during the boom times of the 1920s, but by the end of the decade the U.S. economy was crashing. During WWI, U.S. farms and factories had supplied much of the world with the food and supplies needed to fight the war. Most economic growth occurred in industrywith automobile manufacturing a large part of this. Factories also turned out a wide range of consumer goods. This success was reflected in the stock marketduring the 1920s, the overall value of stocks rose 400 percent. Mass Produced Automobiles Before the 1920s, cars had been a luxury only for the very wealthy. Now Fords assembly line model allowed them to be produced quickly and cheaply, and more people could afford to have them. In 1927, Ford discontinued the Model T (above) after having sold 15 million of that model. Radio and Mass Culture During the course of the 1920s, radio became the first mass broadcasting medium. This period was known as the Golden Age of Radioradio broadcasting then was as varied as TV broadcasting is today. Radio became a platform for mass marketing, contributing to the rise of mass culture that has dominated society since. Hollywood in the 1920s Hollywood boomed during the 1920s. Watching a movie was cheap and accessible, and crowds surged into neighborhood theatres and downtown movie palaces. Silent movies were being replaced by talkies by the end of the decadethe first of which was The Jazz Singer (1927). Charles Lucky Lindy Lindbergh In 1927, he became the first person to fly solo, non-stop across the Atlantic Ocean. Within the next decade, advances in aviation would lead to commercial aviation. Flappers Flappers were a new breed of young women who went against the norms of what was deemed acceptable behavior for ladies. They wore short skirts, bobbed their hair, listened to jazz, smoked, and drank. The Harlem Renaissance The Great Migration of African-Americans out of the rural South into the urban North after WWI led to the development of Harlem as a cultural center of African-American life. There,

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Duke Ellington and his orchestra entertained audiences at the Apollo Theatre and people danced the night away at the Cotton Club. Hidden Problems Buying on marginborrowing money from stockbrokers to buy stocks. New wealth was not distributed evenlythe richest 1 percent of the population earned 19 percent of the nations income. Easy availability of creditan arrangement in which a purchaser borrows money from a bank or other lender and agrees to pay it back over timeallowed Americans to increase their spending on consumer goods. By decades end, many consumers were reaching the limit of their credit and could no longer afford to buy the products that kept the economy expanding. The Stock Market Crash By the fall of 1929, consumer spending had slowed; sales of products suffered badly. At the end of October, nervous investors began to sell off their stocks. Others joined, and a huge sell-off began. The worst day was October 29, known as Black Tuesday investors sold off 16 million shares. Stock prices collapsed completely because no one wanted to buy the shares people had sold. Many investors who had borrowed money to buy stocks had to sell them at a loss to repay their loans. Banks that had lent money to these investors were in deep financial trouble. The Great Depression Following the stock market crash, the American economy took a severe downward dive. Causes: Slowdown in industryas industry slowed down, workers lost their jobs. Joblessness and poverty reduced Americans ability to buy food and goods. Banks failedpeople who had savings in those banks could lose their money. U.S. President Herbert Hoover took few actions to fight the Depression. Many Americans thought he was doing too little. Franklin D. Roosevelt In 1932, he was elected as president. Under his leadership, the role of the federal government greatly increased. He pushed forward a program called the New Deal, which was a way of fighting the Great Depression. The New Deal established public works programs that gave jobs to the unemployed, and provided government money for welfare and other relief programs.

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The Rest of the World In 1929, American businesses were responsible for much of the worlds industrial output. Thus, events affecting the American economy would have an impact on other countries. The Great Depression soon spread around the world. Many countries in Europe were already struggling to recover from WWI. Great Britainhigh interest rates led to decreased spending and high unemployment. Germanysteep reparations after WWI led to hyperinflation, which basically meant German money was worthless. Japansevere economic depression in 1927 caused many banks to close. The Smoot-Hawley Tariff Act Signed by President Hoover in 1930. Placed heavy taxes on imported goods in an attempt to encourage Americans to buy goods and products made in the U.S. The act backfiredcountries around the world increased their tariffs on American goods world trade slows to a standstill. As the Depression continued, unrest grew worse. Desperate citizens looked for leaders who could help them.