1929-1939

Stock market crash

No realization of the effect
No money to replenish what
was borrowed

The Roaring 20s

The new concept of credit
Low farm prices
Farm expansion
Farm mechanization

People were buying

Automobiles
Appliances
Clothes

Fun times reigned

Why was this bad?

Credit system
People didnt really have the money
they were spending

WWI
The U.S. was a major credit loaner
to other nations in need
Many of these nations could not pay
back

The Stock Market

People bought stocks on
margins
If a stock is $100 you can pay $10
now and the rest later when the
stock rose

Stocks fall
Now the person has less than $100
and no money to pay back

And then.
Investors tried to sell their stocks
This leads to a huge decline in stocks
Stocks were worthless now
People who bought on margins now
could not pay
Investors were average people that
were now broke
Weak Banking System
Deflation

President Hoover
Well make it!
What He Did: Nothing
Primary Cause: WWI
Germany $33 billion
France and Britain -- $10 billion

The poor were looking for help and no ideas

on how to correct or help were coming
Pump Priming
Keynes theory for employment, interest and
money: 1936

 High Tariffs: US vs Europe

Less trade
Fewer buyers
Fewer sales
Fewer jobs

Gold Standards
US vs UK

Discount Rates Raised: 2294 banks

 Farmers were already feeling the

effects
Low crop prices
Farms foreclosed

Unemployment
Factories shut down
Businesses went out

Foreclosure of Banks
People could not pay their taxes
Schools shut down due to lack of funds

Many families became homeless and

had to live in shanties

Many waited in
unemployment lines hoping
for a job.

People in cities would wait in

line for bread to bring to their
family.

Some families were forced to

relocate because they had no
money.

Hooverville
Some families were forced to live in
shanty towns
A grouping of shacks and tents in vacant
lots

They were referred to as

Hooverville because of President
Hoovers lack of help during the
depression.

A drought in the South lead

to dust storms that
destroyed crops.

The Dust Bowl

The South Was Buried

Crops turned to dust=No
food to be sent out
Homes buried
Fields blown away
South in state of emergency
Dust Bowl the #1 weather
crisis of the 20th century

Some families tried to make

money by selling useful crafts
like baskets.

We sit looking at the floor. No one dares

think of the coming winter. There are only a
few more days of summer. Everyone is
anxious to get work to lay up something for
that long siege of bitter cold. But there is no
work. Sitting in the room we all know it. This
is why we dont talk much. We look at the
floor dreading to see that knowledge in
each others eyes. There is a kind of
humiliation in it. We look away from each
other. We look at the floor. Its too terrible to
see this animal terror in each others eyes.

*FDR*
When he was inaugurated unemployment
had increased by 7 million.
Poor sections (like Harlem) had 50% of the
pop. unemployed
Instated the New Deal

 People everywhere were

effected by the depression
It wasnt till President
Roosevelt took over and
tried to put the economy
back together that people
even saw a glimmer of
hope