Test maybe on next friday-
Be prepared for test.
Notes From Project:
1. What are the Causes of the Stock Market crash and Great depression
-Stock Market high in 29 crashes
_stock Market place where people buy stock
-Stock-Units of ownership in a company
company does good stock prices rise
Bull Market- a stock market when all prices are rising and every one is prospering,1920s
Crashed on Black tuesday October 29
Causes:
buying on margin-
When investors buy small percentage of the stock as a down bayment then barrowed the rest
easy money for investors unrestrianed buying and selling fueled the Markets upward spiral
rising prises did not reflect companies worth
value of stock declined people who bought on margin had no way to pay off the loans
before the 1920s stock market was only for rich people
on margin allowed people to buy alot of stock
90% or more people were not in the stock market-effected them because businesses and banks closed
people lost jobs
stock prices going up company prices going down
Using Credit-
alot of people bought stocks using credit
When prices of stock began falling the investor would pull out, but not be able to pay off the debt they owe
Buying on margin is an example of buying on credit
People stopped buying things at the end of the 20s businesses lost money
Speculation
-buying stocks on the chance of a quick profit, while ignoring the risks involved
-Many People lost a lot of money
-Herbert hoover Was against this while the rest of the Gov promoted it.
Speculation running wild during the 20
Gov not do anything
Fed Reserve bord failed during this time
-controls interest rates
Sudden decrease in stock prices
Governments Lack of regulation of the Stockmarket
-Poolings
Rich guys get together pool money together buy all the stock tell a newspaper.Regular people buy then rich people sell for mucho bucks
Causes of the Great Depression:
Dorthea Lange took pictures of Florence Owens Thompson famous picture her family was looking for jobs. Florence was depressed that she coulnt find andy
Stock market Crashed-
Crisis in farming-
Production of crops raised
income dieclined .Over production no one was able to buy food
Difficult to pay off loans farmers didnt have any money
Distribution of Income-
Was unequal
Most Americans could not afford economic advances
1920s-1929 income of wealthiest rose by 75%
income incresaed 9% as whole
Rich were richer poor were poorer
Bought fewer goods and services-business lost money
a lot of men laid off because of the great depression
People using credit
-Fed Gov. Lowered interest rates
-Could borrow money easily
cant pay it back
-built a lot of debt
People stopped buying as much business lost money
War debt
Tarrifs-tax on imports
-Hawley-Smoot Tariff Act passes to help farmers and manufacturers with foreign competition
-made economy worse
-Foreign contries couldnt buy American product
-caused WWII
War Dept
-we gave money to Germany to pay for depts
CAUSES SMC Mr. Bruns's Talk
1 overspeculation- Speculaion-buying and selling stock quick and not realizing the risk. Led to stockprices being overpriced
2 overproduction of goods->low profits-companies producing to much and not making money laying off workers
3. Buying on margin- brought alot of people into the stock Market
based on barrowed money the people didnt have
st
4. uneven distribution of wealth
rich richer poor poorer
5. too much barrowing from banks due to low interest rates
people buying things is what brings up the economy
Low interest rates in hard times high in high times
Had moderate interest rates in 2000-2008
6. Stock prices overpriced
7.Lack of Gov. regulation
Laziie Faire no rules
8. Fed Reserve ups interest rates
they knew that things were wrong. In later 29 Fed slightly raised interest rates
Question 2-WHAT IMPACT DID THE SMC AND THE GD HAVE ON THE LIVES OF PEOPLE IN THE US
Farmers Life
-prices of crops dropped
farmers lost farms
familes burned corn because coal was more expencive, countryside smelled like popcorn
farmers strike stopped milk and other products from getting into town
blockades set up on country roads to stop trucks taking products into town
some were better off then the people in the city
could produce their own food city people could not
had gardens to grow fruits and other food
had dairy products
way too much food
destroyed to up prices
Banks Closing
Forced to close when stock market crashed
withdrawing money(bank Run)
1933, 9000 banks closed
Bank Holiday-FDR closed banks for a week or two when banks reopened banks would be safe
The people lost everything
City life
unsanitary unheated crowed tenements
soup kitchens sometimes provided free meals
farmers and hoboes started moving to the city to look for jobs
families catch rats for food
sign up for welfare
suicides increased
no money to buy coal some people stole the coal.
17 thousand families put on the street every night
some took work for pennies
Men started hunting to provide food for family
Hoovervilles
Shanty House-stuff thrown together to make a shack
Herbert hoover-people hated him
close to soup kitchens
Central Park and Riverside Park-in new york
Garbage Cans-used them to cook with and flattened them for their houses
Hoover Hogs-jack rabbits and armadillos people would eat
Women
worked long hard hours
people thought they were taking jobs from men
they depended on other women to help take care of their children
Their roles changed in this time and it helped advance their equality
40% of americans didnt suffer that much from the GD because they had money
Question #4-What Long Lasting Impact did the GD have on the US and the World.
-WW2-partially the cause of the great depression
The us was actually providing loans to germany to help them get back on their feet
Dawes plan was helping to do this
Depression cause the payments to be reduced
led to the collaspe of the German economic system. Which allowed Hitler to rise to power.
-Helped the Japeneese come to power
Japeneese couldnt trade with US
Chose to invade china to get resources
Germany Burned money because it was cheaper than buying wood or coal.
FDIC
created because many people were withdrawling money
Created under the Banking act of 1933 by FDR
provides deposit insurance for people using banks that are covered by the FDIC
Depsoet insurance makes sure that the money in the banks was safe even if the bank failed
FDIC still around today
FHA
Federal Housing Administration established in 1934
created to insure lones given to people building or buying houses
helped improve living conditions and to give people a straight forward payment plan for their house
Still around today
Lasting Agencies of the dew deal
-Social Security Act. 1935-provided money for old people, widows and orphans
-Wagner ACt-NLRB= 1935 Allowed workers to join unions and outlawed union busting tactics by management
Tennessee Valley Wuthority TVA 1933 Federal government build series of dams to prevent flooding and sell electricy First public competition with private power industries
Securities Exchange Commission SEC-Regulated Stock market
Comments