A Brief History • The roaring 20’s • The Great Depression • A Tragic Low
Roaring 20’s A Time of Prosperity • After World War I, America wanted to isolate itself from the rest of the world. • President Harding wanted to work on industrialization, social experimentation and artistic growth.
The Great Depression 1929-1939 A time of little hope
What is a State of Depression? • Economic Depression occurs when a country is in a recession for a long period of time. • A recession may involve declines in of overall economic activity such as employment, investment(stock market), and businesses at the same time. • Generally, very few people have steady jobs or money in a state of depression.
When did the Great Depression start? • The early 20’s had been a time of great prosperity for the United States. • By 1924 businesses were booming because the government did not interfere or make rules to help control them. • This cause many people to buy stocks with money they didn’t have.
Black Tuesday • October 29th, 1929 • Stock prices were out of proportion to the profit ability of the company. • People thought the stocks were really valuable but they weren’t. • Reality caught up – and crashed down! • On this day the market dropped so severely that any gains made in the last year had vanished.
Stock Market Crash • Investors sell 16 million stocks in one day. Some stocks that they had bought at 1 or 2 dollars they sold for 1 penny. • You do the math: A man bought 50 shares of TIME at 2 dollars. Then sold all of his shares on Black Tuesday for 1 penny. Did he end up positive or negative? By how much?
Banks Close • Many banks had invested their money and were unable to give people the money from their savings accounts when they came for it. • Because of this, many banks closed. • Wiped out 9 million savings accounts. • 659 banks closed.
Unemployment • By 1933, 26.6% of people who were wage earners were unemployed. • This means less then one out of four people had a job.
Unemployment leads to loss of land • Many lost their lands because they couldn't keep up with the payments, and most factory workers had to work twice as had to earn the same amount of money they did before the Depression hit. • Workers were either fired, laid off, or had extra work to do with less pay if they still had their job.
Pres. Hoover Supports Big Businesses Instead of Helping Citizens to Get Food and Jobs.
People Loose Their Homes • As people loose more and more money they also become homeless. • People have to live in small areas in cardboard and tin shacks called Hooverville. Shanty Towns