The Economy Hits Rock Bottom

1
The Economy Hits Rock Bottom

• The Depression

2
Why?

• Speculation
• Stock Market - huge profit margin vs. banks
• Buying on Margin
• Stock broker - received 20 on their loans
• Saturated Market - 6 million on margin - 1929
• - Brokers pulled out, forced down sales
• - Prices fall - everyone pulls out - From Sept.
  to Nov. 75 fall in stocks
• Money in banks gone - not federally insured

3
The Pain

• Depression - Black Thursday, October 24th
  Black Tuesday, October 29th
• Realized problems of 1920s - Drop in industries
  farmers, textile, lumber, mining railroads
• Wealth gap between rich and middle class
• Monetary policy - Federal Reserve System - not
  enough money in circulation to allow economy to
  bounce back.
• Foreign trade - loans to other countries stopped
  to allow more loans on margin.

4
Not Enough

• Hoovers Response Pleaded with business not to
  cut wages or production.
• Public building projects - Ag Market Act Farm
  Board
• Business failed 1929 - 23, 000 1932 - 32,000
  
• Average wage - 2,300 in 1929 1,600 in 1935
• Reconstruction Finance Corporation (RFC) -
  largest federal economic aid ever - 2 billion.
  Helped banks, RR, Insurance co, but not
  individuals out of work.
• Emergency Relief Fund - gave RFC 300 million
  for state government.
• Bonus Army from WWI vets, and Hoovers mistake.

5
Effects of the Crash

• Farmers hurt badly - have to leave to find work -
  Route 66 Highway 30.
• Government gave money to farmers - not to
  sharecroppers or tenants
• Immigrants and displaced persons...
• One in Four were out of work - UNEMPLOYMENT!!!
• Living conditions revert to overcrowding and
  unsanitary conditions
• Homeless - shanty towns - Hoovervilles - hobos
• Lost hope and pride!

6
Culture during the Depression

• New car - still prized possession - tourism and
  trailers (camping)
• Refrigerator still sought after.
• 10 cents in 1930 - two apples, a movie, a
  milkshake, round-trip street car fare
• Movies develop better sound - musicals - 1939
  Gone With the Wind
• Golden Age of Radio - Round the clock programming
• Literature - focused on the struggles of people -
  robbed of vitality
• John Steinbeck and John Dos Passos - class system
  and societal change
• Arts - shows the bleakness of an era - poor
  farmers
• Documentary photography - US stripped of dreams
  and Hopes! Dorothy Lange

7
Henry Ford
8
A House in the Dust Bowl
9
A Family Leaving for the West
10
A Farmer Looking for his Crops!