GREAT DEPRESSION

MEANING OF DEPRESSION
DEPRESSION-SEVERE RECESSION RECESSION-DECLINE IN GDP DEPRESSION-WHEN YOU LOSE YOUR JOB RECESSION-WHEN YOUR NEIGHBOUR LOSES HIS OR HER JOB.

WHAT WAS THE GREAT DEPRESSION?

A WORLDWIDE ECONOMIC CRISIS AMERICA S WORST PERIOD OF UNEMPLOYMENT. A TIME OF POVERTY AND DESPAIR

CAUSES OF GREAT DEPRESSION

Stock market crash(29 oct 1929 black tuesday)(the dow reached a high in 1929 of 381 points ) Bank failure Smoot-hawley tarrif 1930 (U.S. Imports decreased 66% from US$4.4 billion (1929) to US$1.5 billion (1933), and exports decreased 61% from US$5.4 billion to US$2.1 billion, both decreases much more than the 50% decrease of the GDP) Drought condition(1934)(kansas, oklahoma, texas, new mexico, and colorado were the hardest hit regions during the dust bowl) Unequal distribution of wealth Industries using machinery produced surplus of goods Massive agricultural overproduction

IMPACT
Basis of bretton woods and gatt Bank failure Companies closed Poverty Reduction in world trade Unemployment 1932 franklin D. Roosevelt becomes the new president. Agriculture

SOUP KITCHENS
One of the common features of urban areas during the era were soup kitchens and bread lines Soup kitchens and bread lines offered free or lowcost food for people
Unemployed men wait in line for food this particular soup kitchen was sponsored by Al Capone

SOME OF THE STATISTICS

In 1929, 8600 banks failed By 1933 11,000 of the 25,000 banks nationwide had collapsed In 1932 over 30,000 companies were closed Black unemployment rose to 56% in 1932 By 1933 salaries fell by 40% and hourly wages fell by 60% By 1935 10-20 thousand childrens under the age of 10 worked in mills or on farms Overall, world trade declined by some 66% between 1929 and 1934 GDP decreased by 50% 90,000 businesses went bankrupt.

NEW DEAL
Relief: to provide jobs for the unemployed and to protect farmers from foreclosure Recovery: to get the economy back into high gear, priming the pump Reform: To regulate banks, to abolish child labor, and to conserve farm lands Overall objective: to save capitalism Objectives: increased purchasing power and social security for public

CONTINUED
Bank and monetary reforms (Emergency Banking Act). Economy Act Women employment Artist Programs Securities and exchange commission(Watchdog agency for the stock market )

CONTIUNED

Social Security Act -Gave money to states for aid to dependent children, established unemployment insurance through payroll deduction, set up old-age pensions for retirees. National Labor Relations Act Put restraints on employers and set up a National Labor Relations Board to protect the rights of organized labor to bargain collectively with employers.

 Agricultural Adjustment Act -Purpose: recovery for agriculture Paid farmers for conservation practices, but only if they restricted production of staple crops. U.S. Housing Authority - Purpose: recovery and reform Used federal funds to tear down slums and construct better housing.

The New Deal - Pros and Cons

Pros Restored optimism and hope to Americans Provided necessary relief to many Cons Did not really fix the depression Left the nation with much debt ($32 billion) Left people too dependent on government (?)

HOW DID THE GREAT DEPRESSION END

WORLD WAR II (1941) INCREASED DEMAND FOR AMERICAN GOODS

THANK YOU