Posted by 8Brittany on January 13, 2012 at 11:28am
Continue blog discussions today.quiz on friday- explain the cause of the stock market crash that mr. bruns give you and your partner. quiz might be worth 30 pts.-- Causes of the Stock Market Crash*Buying on margin-buy on stock on credit-problem is when stocks go down. Kept driving demand for stocks up.Lead to high demand(for stock)*People believe of permanent prosperity.*Stock prices were over value.*People panicked and sold their stocks.*Speculation-people were taking risks, and take money out after a year if it didn't go as they wanted it to.-Buying and selling-leads to high demand-leads to stock prices being grossly inflated.*Uneven distribution of wealth. Rich got richer, poor got poorer.*too much borrowing from banks. Stock market based on borrowed money*Stock prices were grossly inflated, did not have real value. Companies were not making money/they were losing money.*Federal Reserve increased interest rates.Hurt our economy.*Lack of government regulation.**Effects of Stock Market Crash-investors & businesses lose millions $, thousands of banks fail-saving are wiped out, businesses cut production-lay off workers, Unemployment rises-people quit spending money, Great depression sets in, depression spreads to europe & other parts of the world--Causes of the Great Depression* Reduction in purchasing across board-individuals stopped buying things because they had no money and can't take out loan, companies lose $ >lay off workers>people don't have $ to spend>companies lose $-vicious cycle-key reason*banks that didn't fail weren't willing to give out loans, banks failing(9,000)*Dust Bowl-drought conditions(not a direct cause)*tariffs were raise so companies stopped trading with countries.-takes away world trade, they put high tariffs on our products, republicans didn't realize the importance of world trade-it hurt us majorly.*Stock Market Crash*Agricultural slump due to overproduction/droughts*high protective tariff policies of the 1920's*taxes benefiting the rich-rich got richer,poor got poorer.**Effects of Great Depression*New Deal program start-making the US gov't much larger.*Deficit spending starts. Deficit spending-gov't spends more money than they make.*The New Deal creates many organizations that are still around today-social security*Fascist(nazi), military * communist dictators come to power throughtout the world.1. 1928 Election(466)Herbert Hoover(R) -trained as an engineer/not much political experience. Humanitarian,came across as some one who could careless(during presidency) Secretary of Congress Pretty quite.Won because he was a republican, he has a hands off aproach,Al Smith(D)-Governer of NY for 10 years, governer is like a baby president. Political guy,loved the lime light, lost because he was a democrat-that hurt him, against prohibition, was a catholic(country was anti-catholic, country founded on a protestant religion-were worried that the pope would run the country.)was a blow out(Solid south voted democrat), over 60% voted republican2. Stock Market in the 1920's(466-468)Stock prices rose alot, dow jones industrial average- are the 30 largest companies at the time & it is an indicator for the entire stock market.Reached 381 pts.Stock-share of a company. when stocks fail, investors couldn't do their loans, money was permanetly lost.3. Story of the stock market crash-not the causes(467-469)Begining of year everything was great, no one thought it would go wrong. On March 25 there was a mini crash-peoples stock were going down and people started selling. Charles(charlie) Mitchell said he was still going to give out loans.After March 25 everyone thought nothing would go wrong. On October 24 "Black Thursday" stocks fell, people panicked and started selling their stocks, and the worst was on "Black Tuesday".4. Banks and business' collapse(469)*Banks they gave out loans & then we they came to collect with interest, people couldn't pay them back. So they went out of business, 9,000-11,000 banks failed. People lost their life savings.Businesses-were overproducing, & people couldn't afford to buy products, so they cut workers, 9,000 businesses failed.5. Effect stock market crash had on other countries(469-471)The depression spread to other countries, bank & businesses failed, unemployment, lead to dictators.Great Depression helped lead to WW26. Depression in the cities(472-473)It stunk, people were losing their jobs, didn't have the money to pay for homes and they became homeless. Made shantytowns and named them Hoovervilles. Lots of racism, people felt that the latinos and black were causing them to lose their jobs. US deported alot of latinos. There were bread lines-places for people to go to get free food, and cheap items, soup kitchens.7. Depression in the rural areas(473)They didn't feel as many effects because they could grow their own food. They produced too many goods &went into debt because of it. Farmers had no money.8. Dust Bowl(474)9. Men in the Streets(475)10. Women struggle to survive(475-476)Women were to proud to stand in bread lines, & to show people they didn't have money.11. Children suffer hardships(476)12. Social and psychological effects(477)13. Hoover's background14. Hoover's philosophy/Cautious steps(479)15. Boulder Dam(480)16. Democrats win 1930 Congressional elections(480)17. Hoover takes action(481)18. Bonus Army(482-483)
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