Cause of the Stock Market Crash
Over speculation during 20s
Overproduction of goods
buying on margin
uneven distribution of wealth
too much borrowing from banks
stock prices were grossly inflated, did not have real value
Federal Reserve increased interest rates
Lack of government regulation
Effects of the Stock Market Crash
investors and businesses lose millions of dollars
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 and other parts of the world
Effects of the Great Depression
New Deal programs start - makes the US government much larger
Deficit spending starts
The New Deal creates many organizations that are still around today - social security
Fascist, military and communist dictators come to power throughout the world
Vicious Cycle of the Great Depression
Companies lose money so they lay people off
Unemployment rate goes up and less people buy goods as income has dropped
Companies profits fall so they have to lay more people off or close
Cycle repeats itself
McNary-Haugen Bill
In early 1924, senator Charles L. McNary of Oregon and Representative Gilvert N. Haugen of Iowa introduced a bill calling for the following: "A federal farm board was to be created to purchase surplus farm production at pre-World War 1 prices; The surpluses were to be stored until domestic conditions improved or until a decision was made to offer them on world markets."
Hoovers ironic speech
We in America today are nearer to the final triumph over poverty than ever before in the history of this land.. We shall soon with the help of God be in sight of the day when poverty will be banished from this land."
Hoover in his speech June, 1928
Dow Jones
The Dow Jones Industrial Average is one of the several stock market indicators created by Charles Dow
Dow compiled the index as a way to gauge the performance of Americas stock market.
Today, the average consists of 30 of the largest and most widely held public companies
Black Tuesday
stock market crash, October 29, 1929
Hoover
made the Hoover Dam, one of the engineering marvels of the world
cost 165 million dollars
Relief, Reform and Recovery
relief for the needy
economic recovery
financial reform
FDR Brain Trust
Harry Hopkins - social worker and the architect of much of the New Deal
Henry Morgenthau
Louis Lowe
Cordell Hull
If we were president after the beginning of the Great Depression, we would fix the economy by making programs to help people out. We would create new jobs so there would be less people unemployed. We would try to get people out of the "Hoovervilles". We would make that happen by making a program for more people to go into construction. Also, we would find new resources for people.
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