Continued on with the Chapter 14 Test topics.
Ch. 14 Test Topics:
-- Causes of the Stock Market Crash: Causes for the stock market crash: investors getting money from brokers, brokers getting money from banks, and when the banks fail, all of that money is gone forever. The high credit delinquency was also a problem because everyone could just use credit to buy nice things, but as time went on they were unable to pay because they didn't have any money. Another problem was the high interest rates. Not a lot of people could afford the higher interest, so people just stopped buying. Over speculation, in which stock prices didn't have any real value (borrowed money) was another problem. Some more problems were overproduction of goods, buying "on margin", uneven distribution of wealth, too much borrowing money (major problem), and lack of government regulation. The government was almost as in the dark as the people were.
Effects of the Stock Market crash: Investors and businesses lost a lot of money... up to $40 billion. Up to 9,000 banks failed throughout the course of the Great Depression. Since people stopped buying from businesses, the businesses were unable to pay their workers, so the workers were laid off, which caused the unemployment rate to skyrocket. Since many people didn't have a job, they just quit spending. The depression spread to Europe and other countries around the globe. The New Deal created many organizations, like Social Security, that are still around today.
--Causes of the Great Depression: Farmers thought that they needed to keep planting more and more crops, but that actually made crop prices go down. The underconsumption of goods by consumers made it all worse. There were so many crops that were being made, and not eaten. There was an agricultural slump due to overproduction, the stock market crashed, the taxes benefited the rich, but didn't help the poor people at all, and there was a high protective tariff policy to prevent foreign imports.
1. 1928 Election(466): the Presidential election consisted of Herbert Hoover (R) and Al Smith (D). Herbert Hoover became president. Hoover won because he went out and talked to states that were considered "Republican states". It was quite amazing because there were only 7 states that were considered "Republican" vs. 43 that were considered "Democratic". Things that hurt Al Smith were his being a Democratic (there had been better times with Republican presidents), he was a Catholic (only one past president that was Catholic: JFK), and he was against Prohibition.
2. Stock Market in the 1920's(466-468): the Dow Jones are the 30 largest companies in the US. It's considered as the general state of health of the stock market. If the Dow Jones isn't doing well, then the stock market in general isn't doing well. If the Dow Jones is doing well, then the stock market is generally doing well.
3. Story of the stock market crash-not the causes(467-469): Banks lost their money, and people started to panic and take their money out of the banks, so banks no longer had any money. Businesses started to lose money, they laid off their workers, workers try to save and don't buy anything, businesses don't get their money, and the vicious cycle continues on a nosedive down. The unemployment rate was about 25%, compared to now when the worst it's ever been in the Recession was 10%.
4. Banks and business' collapse(469): When the stock market crashed, all of peoples' savings were gone, and no one had any more money. The banks were unable to give loans, so no one had any money and couldn't purchase anything, which in turn caused banks to fail.
5. Effect stock market crash had on other countries(469-471): America raised the tariffs so then people would only buy American goods to get America more money, but people in Europe had a harder time getting money with the raised American tariffs, and with Europe struggling, that helped Hitler to come to power in 1933.
6. Depression in the cities(472-473): Since a lot of people began to lose their jobs, they also began to be unable to pay for their homes. So they began to live in Shanty towns, one of which was called "Hoovervilles". People were trying to get the message across that President Hoover was responsible for all of the terrible things that were happening to them. People booted out people from Latin America because they felt that the Latinos were taking the jobs that "rightfully belonged" to the Americans.
7. Depression in the rural areas(473): Lots of farmers lost their farms: about 400,000 farms in 3 years were lost due to inablity to pay mortgage and other payments. There was an overproduction of crops, to a point where there were people starving in the cities but the farmers were killing and destroying and spilling all of the extra products that were made
8. Dust Bowl(474): There were thick and tall clouds rose hundreds upon hundreds of feet off of the ground. After a cloud passed, everything in the houses were dirty--all the bathing places were no longer sufficient for cleaning since it was so dirty, the lakes and water supplies and all contaminated, and many people began to have respritory problems.
9. Men in the Streets(475)......mine :)
10. Women struggle to survive(475-476): women stayed home with the kids to support the family as much as they could. Some women had jobs, but they were paid a lot less than men. They were too embarrassed to stand in bread lines, so there were mainly men looking for the food.
11. Children suffer hardships(476): a lot of children, teenagers called "Wild Boys" just left their homes and became hobos and just wandered around. A lot of kids were out of school because the schools were failing so badly, so they had to find work. Sometimes the work conditions were absolutely terrible, and they were paid little to nothing at all.
12. Social and psychological effects(477): People didn't have a lot of money, or hope for that matter, so the suicide rate rose so much that it got up to 30% at one point. The divorce rate went up a lot as well.
13. Hoover's background: He was president during the beginning of the Depression into 1933. He believed in the "trickle down theory", which was the help of the big businesses that would then help little businesses, helping more people to get a job, then helping to get the country (and the world) somewhat back on track.
14. Hoover's philosophy/Cautious steps(479): some of the things involved with Hoover's philosophy were the trickle down theory--as explained before, laissez-faire, and rugged individualism. The trickle down theory means tax breaks for the upper class which was believed to help the middle class, in change helping lower class over time. People didn't really like that because they were starving and they didn't want to have to wait for help to come. Laissez-Faire means "let alone" or "hands off", meaning the government should leave businesses alone. Rugged Individualism was that people would have to step up and work to help themselves. If the government gave out welfare checks, then people would become lazy and just rely on the government to help them instead of doing something about it themselves.
15. Boulder Dam(480): built between 1931 and 1936. Congress began planning to build it in 1928. They hired thousands of men to help build the enormous dam. They used to call the dam the "Boulder Dam", but they renamed it as the Hoover Dam. There was controversy over who they were going to name the dam after, Herbert Hoover or Franklin Roosevelt. Hoover thought that it was alright to spend a whole bunch of money on something that would eventually pay for itself. He didn't want to spend money on something that would waste the money spent on it. Herbert Hoover thought that he was completely responsible for the success of the dam. When Hoover was president, he had about a year of good times before the stock market crash.
16. Democrats win 1930 Congressional elections(480): Hoover and the Republicans got turned on because the economy was getting worse more than it was getting better, so the Democrats used that to their advantage to win over voters for the election. People realized that they wanted change so they ended up voting for Roosevelt in the end.
17. Hoover takes action(481): Hoover tried to jumpstart the economy by spending millions on projects like the Hoover Dam. He backed the Federal Farm board, which was the buying the surpluses of crops that the farmers harvested. The bad side to that was that the crop prices went up. He did try to help the banks and create more jobs, but he just didn't do nearly enough to fix the economy completely.
18. Bonus Army(482-483): There was supposed to be a bonus check of a couple thousand dollars that would go to the soldiers for their service in WWI. But when the Great Depression set in, then there was going to be a bill that instead of waiting to pay them in '45, why not just pay them right then. They have a march in trying to get the bill passed because they needed the money to support themselves and any families they may have had. The bill wasn't passed, and people didn't believe that Hoover was doing anything for the people and that he didn't care. All of these events really helped to jumpstart Roosevelt in the election, which ended up being a landslide in Roosevelt's favor.
Onto the Chapter 15 test topics:
Ch. 15 Test Topics
Describe the cycle of the Great Depression?
What was the New Deal(1st and 2nd) and it's goals(3 R's)?
Why did people criticize the New Deal?
Why was FDR upset with the US Supreme Court and what did he do to try to solve this issue?
How did the New Deal help:
unemployed
farmers
factory workers/labor
young people
banks/business
home owners
elderly
Native Americans
Describe the culture of the 1930's.
Key terms:
Hundred Days
fireside chats
priming the pump
deficit spending
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