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The Great Depression

The Great Depression. The End of Prosperity…The Beginning of a Colossal Struggle. 1920’s- Evidence of Prosperity. 1921- 1.5 million cars sold 1929- 4.5 million cars sold 80 million people to movies/ week Rising stock prices 1928 RCA ($85- $420). Rising Stock Prices= Bull Market.

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The Great Depression

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  1. The Great Depression The End of Prosperity…The Beginning of a Colossal Struggle

  2. 1920’s- Evidence of Prosperity • 1921- 1.5 million cars sold • 1929- 4.5 million cars sold • 80 million people to movies/ week • Rising stock prices • 1928 RCA ($85- $420)

  3. Rising Stock Prices= Bull Market • Continuing rising stock prices • “Everybody Ought to be Rich” • People “bought on the margin” • Speculation

  4. What goes up…must come down! • Few predicted a Bear Market • This is a continual drop in stock prices

  5. And then BAM!!

  6. October 29,1929 • Black Tuesday • $15 Billion in stock lost in one day • Panic spread- everybody sold their stocks

  7. Panic of 1929 ensued… • $50 billion loss by end of November • Examples • GE- $396- $168 • US Steel- $261- $150 • “on the margin” purchasers forced to sell everything

  8. Economic collapse…a vicious cycle • Andrew Mellon and comrades in denial • Businesses slowed production/ laid off workers • No jobs/ no consumption • More lay offs/ slower production

  9. And this is how the Great Depression began • Between 1929 and 1931 the GNP dropped by almost 30% • Unemployment quickly rose to over 20%

  10. Banking crisis • Unable to pay bank debts(farmers, individuals) • Small banks could not pay big banks and failed • People rushed to take out their money • 1929- 1933- 9,700 banks failed

  11. What did people think? This was all part of the natural business cycle in a free enterprise economy

  12. Causes of the Great Depression • Overproduction • Bank failures • Stock market crash • Struggling industries • Unequal distribution of wealth • Unwise trade policies

  13. Coming to a classroom near you… President Hoover and the Great Depression

  14. HERE IT IS….

  15. Depression hits home • Who suffered? • Everybody • Especially new immigrants, Latin American, African Americans • They were the last to be hired, first to be fired

  16. In the Cities… • Thousands of unemployed competed for jobs, food, and shelter • Sometimes literally- • American citizens fought for food scraps like animals

  17. Farm families • Better equipped to get basic necessities • “It’s my sister’s turn to eat” WV schoolgirl

  18. People lost their homes and left to look for work… • People begged for food • Stole food • Some starved to death • Built clusters of shacks from cardboard or wood • Blamed Hoover…

  19. Hooverville

  20. How did people survive? They needed food clothing, shelter, and money. • Relatives, neighbors, and churches • Red Cross • Salvation Army • People robbed bread trucks • Private charity could not provide for all

  21. More to come…

  22. Hoover’s philosophy • Gave little help to Americans • Insisted economic downturn was temporary • In 1930 declared, “The Depression is Over”

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