The Great Depression

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The Great Depression

• 1929-1939

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Impacts of Depression

• Prices of stock dropped 40
• 86,000 businesses failed
• 9,000 banks went out of business
• 9 million saving accounts
• Wages were decreased by at least 60
• Unemployment from 9 to 25
• 15 million people unemployed

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The 6 Causes

• 1. Unequal distribution of Wealth
• - 2 owned 3/5 (60) of wealth
• - 98 shared the remaining 2/5 (40)
• - ½ population living
• below poverty level
• - unequal balance
• between production
• and consumption

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The 6 Causes

• 2. Unequal distribution of
• corporate power
• - mergers reduced competition
• - when company fell loss of jobs stock
• - 200 corporations controlled 50 of all
  products being made

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The 6 Causes

• 3. Poor banking structure
• - no regulations
• - small banks owed to larger banks
• - unequal loan to deposit ratio (esp. small
  towns)
• .

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• http//www.youtube.com/watch?vqu2uJWSZkck

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The 6 Causes

• 4. High Tariffs and War Debts
• - Hawley-Smoot Tariff tax on imports
• - What was the goal?
• - Led to unbalanced foreign trade
• - economic warfare other countries did same
• - war debt U.S. as creditor E. couldnt repay

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The 6 Causes

• 5. Overproduction in
• Industry Agriculture
• - farmers bought machinery
• on creditto increase
• production
• - gtgt overproduction
• - gtgt no jobs no to buy
• - gtgt couldnt pay off debt...
• - foreclosures on farms

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The 6 Causes

• 6. Stock Market Crash
• - Reasons for investing in market
• - had already to invest
• - Buying on margin
• - Stock Speculation
• - October 24th Black Thursday
• -Bunk Runs
• - October 29th Black Tuesday (16 mil)

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BUYING ON MARGIN

• Who did they need to attract?
• HOW?
• Investors only had to pay for 10 of the stock's
  actual value at time of purchase
• If a stock is 100 you can pay 10 now and the
  rest later when the stock rose
• balance was paid at a later date

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Buying on margin
The good
The bad

• Stocks go up
• Borrowers sell at high price
• Pay off
• Loan
• Interest
• make extra

• High interest rates
• Demand payment anytime
• If stocks fall then dont have money to pay back

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• STOCK SPECULATION
• people would buy and sell stocks quickly to make
  a quick buck
• b/c of all this buying selling, stock value
  increased
• Ex G.E stock 130 ? 396/share

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THE CRASH

• BLACK TUESDAY, Oct. 29th, 1929 - NYC Stock market
  crashed, causing a depression that would last
  until 1942

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STOCK MARKETCRASH

• Loss of confidence
• Uneven wealth
• Rising debt
• Stock speculation
• Overproduction
• Hardships of farmers and factory workers

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The Effects

• Widespread unemployment gt poverty gt hunger
• - What led to this????
• - national income
• 1929 81 billion
• 1932 41 billion
• - 15 million jobless

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The Effects

• Breakdown of Families
• 1. personal suffering gtgt suicide
• 2. high school drop out rate gtgt
• - kids working in sweatshops
• 3. runaways (Hobos riding the rails)

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The Effects

• Organized Protests
• - farmers marching on banks with
  pitchforks and gun
• - tried to prevent foreclosures
• - Dairy farmers frustrated w/low
  price of milk refuse to sell so they
• dump it
• - Bonus Army

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The Bonus Army Who were they? What did they
want? What did they do? What happened to them?
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The Effects

• The Bonus Army
• - WWI soldiers promised 1 per day extra served
• - To be paid in 1945
• - Allowed to borrow
• against it in 1931
• - 1932 asked for full
• amount denied

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• Thousands from all over U.S. marched with their
  families
• on Capitol Building in D.C. to protest

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• Calvary, tanks
• Used tear gas and bayonets

• - Sent home with money from their bonus pay

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• http//www.youtube.com/watch?vdWvCCxOUsM8

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Many waited in unemployment lines hoping for a
job.
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People in cities would wait in line for bread to
bring to their family.
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Some families were forced to relocate because
they had no money.
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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.

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Hooverville
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Out of the Dust
The South and the Dust Bowl
1931-1940
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A drought in the Central and Southern Great
Plains led to dust storms that destroyed crops.
The Dust Bowl
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Central and SouthernGreat Plains
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The South Was Buried

• Crops turned to dustNo food to be sent out
• Homes buried
• 60 lost their farms
• Many moved
• South in state of emergency
• Dust Bowl the 1 weather crisis of the 20th
  century

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Two Families During the Depression
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A Farm Foreclosure
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Some families tried to make money by selling
useful crafts like baskets.