Hoovervilles- assigned blog topic
Continuing Presentations today:
1. What were the causes of the stock market crash of 1929 and the Great Depression?
stock market- a market where stocks and bonds are traded; stock- when you buy a part of a company and if they make money you make money but if they lose money you lose money everyone who invested in the stock market had lost everything when it crashed Dow Jones Industrial Average: top 30 stocks in the US/ stock market indicator.
Causes of the crash: uneven sharing of wealth (top 1% of the US controlled the money.) wages couldnt keep up with the production, heavy increase of gambling and buying stocks. The business cycle- contraction, expansion, peak, recession. tight money policy- cut off credit and raise intrest rates (forces people to buy less which makes the companies lose money and people would lose jobs) Buying on margin- buying on credit for stocks. giant gap between the rich and the poor. overexpansion of buying on credit. banks used peoples money to invest in the stock market. debt- quit spending money. overproduction of farm goods, prices lowered, farmers lost money. gov't used a laissez-faire approach, stayed out of all of the businesses- didnt regulate the stock market. overspeculation: led to stock prices overpriced. gov't did not regulate the stock market in the 20s.
great depression- period of time were the stock market ccrashed and caused an economic crisis. Stock market crash in 1929, banks were failing, reduction in purchasing, american economic policy with europe- tarriffs were created on goods from europe (record high) europe also put tarriffs on their products- used to protect american companies but didn't help. eliminated trade around the world. , drought conditions- farmers couldnt produce anything, everyone left the region of texas, kansas, nevada. also known as the dust bowl. Reduction in purchases- people lost their jobs so they couldnt buy things, businesses werent getting money so they had to raise prices and lay people off, then more people couldnt buy things- vicious cycle.
2. What impact did the stock market crash and Great Depression have on the lives of people in the United States?
homelessness- mortgages were foreclosed(bank would take the houses because people weren't paying) and left millions of people homeless, led to people building small villages of shacks called hoovervilles. starvation and illness- people couldnt afford food, went to dumpsters to look for food, not many deaths from starvation but didn't get enough food, led to soup kitchens and stuff like that. Unemployment- at an all time high, 25% in the US and 33% in some other countries. many people had to steal food, many committed suicide because they had nothing.
impact of the stock market- bank failure, business failure, no economic growth. people would try to get their money from the bank but they didnt have it. 40% of banks collapsed. by 1933 people lost 140 billion dollars.
all of Europe was affected by our great depression, especially GB. Some countries were put into a depression of their own.
dust bowl- made it worse, caused by major drought. people had to wear masks whenever they went outside.
3. What did the United States government do to help alleviate the problems the Great Depression brought to our country?
see powerpoint for notes
4. What long lasting impact did the Great Depression have on the US and world?
after the crash banking methods became strict- SEC: enforces security laws and protects investors and keeps the markets secure. FDIC: protects money in banks by insuring the money will be there. social security was created which we still have today. relief programs were introduced.
short term: crime rate rose, sports and movies were popular to distract from the great depression.
Still around: created by FDR: Securities and Exchange Commission- helped make sure that people would follow the law dealing with stock. , Federal Deposit Insurance Corporation, National Labor Relations Board, Tennessee Valley Authority- provided navigation, flood control, electricity, fertilizer, and economic dev. in Tenn. built lots of dams., Social Security Administration.
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