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1928 presidential elections - Herbert Hoover and L. Smith. It was Hoovers first time running. Before he ran he was a stay at home nurse. Al Smith was a governer of California. Big issue was Coolidge was anti prohibition. Hoover won this election because of prosperity with an easy win. He wanted to change economic parties. He said everyone would be wealthy and we would be permanetly prosperous. Most americans agreed. It wasn't until the 60's when the south became republican. Americans became free.
Stock Market in 1920's - a piece of paper which says you can buy into a company. The reason it kept going up because people thought we were under prosperity. Balloon Payment - having to pay the whole amount at once, it led into margin buying - allowed average consumers to buy stock. The problem was if stocks went down the stock broke would need money back because people couldn't pay it back. Banks closed causing people to lose life savings. Market was booming - record stock prices hit record levels. Speculation - buy and sell quickly it creates demand prices went up. Prices were over inflated.
Stock Market Crash - When the crash happened, the clock ticker was lagging so people were quickly selling their stocks. Stocks went down in value - no one was buying so the paper was worth more than the company. The Dow Jones Industrial Average is one of several stock market indicators created by Charles Dow. Many people lost their savings. Banks invested people's money into the stock market. The week prior to Stock Market Crash - on black Thursday - major crash - 4 million shares but 12.9 millions shares were traded leading up to black Tuesday - Charlie Mitchell, Chase Bank - J.P Morgan Bank bought lots of stocks - over the weekend stock people decided to sell their stocks.
Banks and Businesses Collapse - Stock market crashed and that was a problem because people had money in banks, but the banks lost a lot of money because they were putting out peoples money in the stock market. Another reason they collapsed was because they kept handing out loans. And when all the money was gone, banks would close. The Federal Reserved bank was supposed to not close down when all the money was gone, but it failed in the 1930's. Approximately 11,000 of 25,000 banks closed. People ran to the bank to take out their money before the bank could give it to the stock market. If people didn't get their savings out, they'd lose it. Between 1929 and 1932 the input of trading was half as much as it was before. Things went down, and people lost their jobs. 25% of people lost jobs. People weren't spending money, so businesses don't make money, so they lay off people and close down, and the cycle repeated. 90,000 business went bankrupt, including car businesses. Just banks failed miserably.
Effect Stock Market had on other Countries - There were higher tarriffs (tax on imported good). When the tarriffs are high, other countries aren't gonna wanna buy American goods, and that wasn't good on American business. Other countries put higher tarriffs on our goods too, so we aren't able to sell over seas. Lead to gradical leaders. Germany was trying to pay back, but that doubled problems. Gread Depression led to WW2.
Depression in the Cites - Hit hard, because people have factory jobs in the cities, and no one was buy stuff so people got laid off. And since no one was making money, people got kicked out off their homes and appartments by their landlords, and that was pointless because people weren't gonna buy homes anyway. People lived on the streets. Hooverville was shanty town. Basically was made up of shack houses, made of cardboard or scrapes of wood. People who didn't have homes covered themselves with ''hooverblankets'' made of newspapers. Becaue people didn't have a lot of money, they stood in bread lines to get bread. Manly men would stand and bring the 'bacon' home. Lots of kids dropped out of high school to help their family. People hopped on trains to hit the next city to find jobs - verrrrrry dangerous. People would sell apples on the streets too. Made 2 or 3 cents an apple.
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