We went over the power point again.
Causes of the stock market crash-1929
- Over speculation during the 1920’s
- 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
- Investors and businesses loss millions
- Thousands of banks fail-savings are wiped out
- Business cut production-lay workers off
- Unemployment rises- people-quit spending money
Causes (know 4)
- Under consumption of goods by consumers
- Agricultural slump due to overproduction
- High protective tariff policies of the 1920’s
- Taxes benefiting the rich-rich got richer, poor got poorer
- Stock market crash
Effects of Great Depression
- New deal programs start- makes the US gov’t much larger
- Deficit spending starts
- 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 $$ 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
Hoover’s 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 the land.”
Boulder(Hoover) Dam
- Boulder Dam, located 34 miles from Las Vegas, is one of the engineering marvels of the world
- Hoover Dam is 726 feet high and 660 feet thick at its base
- Including the dam , the All-American Canal, to town of Boulder City, highways, city
The new deal
- Relief, Reform, Recovery
- Relief for he needy
- Economic recovery
- Financial reform
- FDR's Brain Trust
- Harry Hopkins- social worker
- Henry Morgenthau
- Louis Lowe
- Cordell Hull
- Frances Perkins- Sec. of labor and first female in the cabinent
- Sam Rosenman
- Raymond Moley
- Rexford Tugwell
- Why was it challenged?
- Created a very powerful president that led congress, this was a violation of checks and balances.
- It was a radical departure from Laissez Faire ideals. Created "big government"
- Some acts appeared interfering and at worst unconstitutional.
- Heavy Debt burden- the united states was engaged in deficit spending and this was unhealthy for the economy in the long run.
New Deal vs. 2nd Deal
- Restore nations hope
- Help banks and stock market
- Provide jobs and relief for poor
- Plan and regulate the economy
- Pass new labor laws
Reconstruction Finance Corporation-1932
- Gave loans to banks, state and local govt's, and business' to create projects/jobs for people
- Started under Hoover
- Dissovleved after 1942(World War II)
****Civilian Conservation Corps-1933
- Members lived in camps, wore uniforms, and lived under military disipline
- 18-25 year old guys
- Planted trees, fought forest fires, stopped soil erosion
Federal Emergency Relief Act
- Direct relief measures
- provide work for emplyable people
Public Works Administration
- Built schools and hospitals
- Unemployed people who it helped
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