Semester 2 Test Blog

What were the causes of the stock market crash of 1929 and the Great Depression?

Buying on Margin: Buying on margin allowed more middle class people to invest large amounts of money into the stock market. They would take out "loans" from investors with the intentions of paying them back with interest when they started to profit from their investments. The fact that so much of the stock market was supported by borrowed money made it very unstable.
Overvalued Stocks/ Over Speculation: Stocks were being sold for much more than they were actually worth. Investors expected the value of stocks to continue to increase. Speculators were the ones who quickly bought and sold stock to make money. For the first time it allowed a lot of not wealthy people to get into the stock market. People wanting a piece of paper and not paying attention to the company.
Buying on credit: During the 20's, buying on credit was a new fad. There were no real limits on how much people could borrow this allowed people to acquire large amounts of debt. Because people were in debt they stopped buying things, and distributing money into the economy. This contributed greatly to the depreciation of stocks' value.
No Government Regulation: The government had not set good enough regulations for banks, No requirement for minimum capital to start a bank had been made. No limit to how much banks could lend out had been set. When the market crashed, banks that had a lot invested into stocks were wiped out.
Federal Reserve increased interest rates- They set up 12 Federal Reserve banks around the country and if a bank was in trouble they would borrow from this bank. This bank failed though during the 1930s when banks needed money. This bank made it easy for people to borrow money though because it’s easier to pay back because there is less interest

2. What impact did the stock market crash and Great Depression have on the lives of people in the United States?

Children: They would write to the president for help such as shoes, clothes, and money. Boxcar Kids were children that ran from home and lived on the railroads. Life at home would be very sad, so they ran away from home.
The girls: Would dress like boys for safety. Many of the girls wore flour sack clothing.
The men: Felt like failures, because they usually supported the family, but they couldn't help their family in this time. 1.5 million Husbands left their wives during the Great Depression.
Women: felt as if their household jobs were enhanced.
Many people committed suicide. Once everyone started to lose their jobs, there was not a lot of money for people to spend on food. Usually family lost their homes etc. People who were to marry or divorce had to wait.
The birth rates dropped because people couldn't afford to support more people.

Farmers: The corn prices dropped drastically. Many of the farmers were burning their corn to stay warm because coal was too expensive. They had to live off the land and survive.
Some of the wealthy people lost money, but it didn't affect them because they were so rich. They didn't always notice that others were suffering. They went on with their daily normal life. Some of them tried to help out the poor people. Some of the wealthy people flaunted their money more during that time.
Hoovervilles: were made and the Hoovervilles were towns made from any kind of material found. The homeless were living wherever they could which included a park bench and under newspapers. More and more people were looking for jobs and because of that most of the jobs were given out to the whites. Women were usually fired due to the fact the people thought they were taking jobs from the men. Getting a job was essential to living at the time. The drought and
over-plowing had an impact on the farmers. This lasted for 8 years.

3. What did the United States government do to help alleviate the problems the Great Depression brought to our country?

Reconstruction Finance Cooperation:

Passed in 1932
President Hoover came up with this and President Roosevelt continued with it.
Ex. Trickle-down-theory- Which is the government giving loans to state governments and big businesses.
Which used the money to create jobs for people hence trickling down to help everyone else
As the money was given out some state government used it as direct relief.
Designed to create jobs for people and many different types.
Dissolved in 1946

Bank Holiday:

First thing that FDR did
Had problems with banking thousands and thousands of banks closed down in 1933 for several months but throughout 1930s
FDR decided to get on the radio and he said he was going to close the banks down for 4 days—“Bank Holiday”
He told the American people that when the banks open again that they will be safe when reopened and they can put their money in them and it will be safer than keeping money at home with them.

NIRA-National Industrial Recovery Act

Set up codes to fair competition
Ex. giving workers a decent wage as well as decent hours during the depression and also having fair prices for consumers.
If you follow these you would then be given a blue eagle coat (poster) to put up in your window.
If you walk by and wanting to go to a restaurant and 1 has one and the other doesn’t your most likely to go into the one with it.
Slogan: We do our part which means doing their part to help workers and consumers
NRA: Forced this act

SSA - Aided the elderly, disabled, dependent children...

NYA - College students ages 18-25 helped them stay in college by giving them work study jobs.

CCC - Conservation Civilian Corps - Gave young men outdoor jobs such as

TVA- Paid farmers to destroy crops because they weren't profiting from them. Cities were struggling for food, but they were killing the source of food.

CWA - Provided jobs for unemployed people -- mainly construction work

WPA - Employed unskilled men and women to do public projects. Build roads, parks, schools, etc.

4. What long lasting impact did the Great Depression have on the US and world?

Short term: crime rate rose, sports and movies were popular to distract from the great depression. Communist dictators came to power throughout the world.
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.
Gov’t became much larger after the GD.

SEC: Secure exchange commission

SEC: enforces security laws and protects investors and keeps the markets secure.

SEC was to regulate the stock market and prevent in proper gain of benefit and we will go after people if they are breaking laws
Stock pool- Pool together, wealthy people but stocks together
Buying on Margin- Borrowing
Stock Watering- An asset with an artificially-inflated value

FDIC:

FDIC: protects money in banks by insuring the money will be there.

Federal deposit Insurance Corporation: was created by congress.
It started after the great depression to make sure that the people’s money would be safe if the banks failed again

Allow people to be able to put no more than 250,000 in the bank and it will be secure if the banks were to fail again.
If you put more than 250,000 and the banks fail you may not get it back
This is still around today

Social Security System:

Social security was created which we still have today. Relief programs were introduced.

Federal program of social insurance with benefits

Roosevelt new deal
Benefits then:

Retirement income
Disability income
Dependent children
Unemployment

Benefits now:

Retirement
survivor and death benefits
Disability
Medicare

Welfare:

Started with British poor laws
Gave it to migrant workers, people who were committing crimes, elderly and children

5. What were the causes of WWII?

Cause of war in Europe: Germany and Soviet union invading Poland

Causes of war in Asia: Japan Invading China

Causes of US involvement: Pearl Harbor

6. What impact did the United States have on WWII?

Made a huge impact because of our troops and factories. The number of troops and the amount of stuff..war goods we made and with that stuff it pushed us over the top. The nuclear bombs. Ended the war in japan much more quickly than it would have. Women working in the factories who made the stuff. Also people buying war bonds for our money into the government.

7. What were the goals for the US during the Cold War?

US Goals-Wanted to promote open markets for US goods to prevent another depression, promote democracy throughout the world, and stop the spread of communism.

USSR Goals: wanted to secure their borders and make sure they were safe. feared a strong Germany. Encouraged friendly gov'ts on their borders. Spread communism around the world.

8. What were some of the major events that took place during the Cold War?

-Berlin Blockade/airlift

Germany was split into 4 zones after WW2

East Germany Berlin was entirely into the soviet zone and since Berlin Capital of Germany Stalin didn’t think we should be there and so he blockaded it. He doesn’t allow anything into or out of it and so we decided to drop things in by airplanes and since Stalin didn’t want to shoot them down since that would led to war he ended it.

Airlife--

-Cuban Missile Crisis

Soviets had nuclear missiles in Cuba. Closer range to attack us possibly and because of the Bay of Pigs invasion just happened. They were worried about a future invasion by the US. They invite USSR to Cuba. We found out by spy planes that took photographs.
After this happened: a 13 day crisis. We panicked. There was a compromise reached-Soviets pull missiles out of Cuba, we promise to never invade Cuba, we pledge in secret to remove our missiles from turkey in 6 months. This is the closest we ever came to nuclear war.

-Red Scare/McCarthyism

Joseph McCarthy was really the start of the whole communist scare in America. He put the idea in people’s minds that anyone could be communist (or a red), your next door neighbor, Hollywood stars (they were hit hard and many left to go make movies in other countries), politicians, anyone really. He was pretty crazy actually and even said that he had a briefcase that contained the names of hundreds of people who were confirmed communists. This briefcase was never shown but I think it’s pretty safe to say he was bluffing. Eventually, the whole scare was ended when people realized he was crazy by accusing the president of being communist. He went too far and was taken down.

-Space Race

race between USSR and US to get into space and to the moon. Soviets were in the lead because of Sputnik, an unmanned satellite. We thought they could use it to spy on us. We felt vulnerable. WE thought if they were ahead in the space race, they were ahead in the missile race.

-Bay of Pigs

In 1961, the US wanted to invade Cuba but knew that such an action would look bad: a world superpower invading this little country. So the US government rounded up a bunch of Cuban exiles and had them invade the country in the hope that the rest of the Cubans would rise up and revolt with them. They didn’t and all of the exiles were either captured or killed. The US had promised them air support but had not followed through with their promise and the Cuban exiles were very, very upset with the US. So the exiles spoke out to the press about who was actually behind the invasion and it was a huge embarrassment for the US government, particularly JFK.

-Berlin Wall

A wall that the Soviets built to keep the people in the east pretty much trapped there because most were fleeing to the west. They didn’t want to build the wall because their whole theory, that the people would choose communism (everyone’s equal but in poverty) over democracy (freedom), was being proved wrong. The people were choosing freedom and so they felt they had to build the wall. Eventually, when the Soviets realized that no one was going to choose communism, they let the wall be torn down by the people. The soldiers, guards, and government didn’t do anything to stop it, they just let it happen.

-End of the Cold War

Ronald Regan is tough on communist and had tough push and Gorbachev wanted change and the two guys met and became friendly and helped the process and the Gorbachev speeches opening up the economy.

Also soviet mistakes with the invasion of Afghanistan and that hurt them big time they were struggling

9. Why did the US go to war in Korea and Vietnam and what were outcome of those wars?

They went to war to stop the spread of communism.
North and South Korea signed an agreement and north was communist and south was free
Korea- North Korea invaded South Korea and tried to turn the whole country to communism. The US got involved because the United Nations decided it was time to step in after the North invaded the South. The UN was really kind of flexing their muscles a bit because they’d never shown what they had the power to do if they needed to intervene in a country before. The US was able to push the forces of the North back to almost China but then China began to feel threatened and voted to go to war but Taiwan (who was actually the ones on the UN for China at the time) disagreed and knew that if they got involved the Soviets would as well. Then everyone would just be going to war and no one really wanted another war at the time. Eventually the North and South came to an agreement to stop fighting (a cease-fire) and unite the country but a formal document was never signed so technically the two countries are still at war today.
And we pulled out of Vietnam and then north invade south and became Communist Vietnam.
We, of course, wanted to stop the spread of communism and promote democracy. We wanted to promote open market goods for the US good in order to prevent another depression. Nixon called for Vietnamization which was when he pulled out all the troops and made Vietnam survive on its own.

10. How did the Cold War come to an end?

Reagan took a very hard stance against communism and didn’t believe in the whole détente theory. He believed that if the Cold War was ever going to end, then the two countries needed to be against each other. Reagan had numerous meetings with Gorbachev (the last communist Soviet leader) and because of these talks, and Gorbachev’s willingness for change, the Cold War was coming to an end. Eventually, the Soviet Union gave up on communism (saying it had failed) because of Gorbachev and his willingness to reform the country. Also, the country was in economic ruin at the time. They had a huge deficit, high inflation, social problems, and a shortage of basic needs. The problem was that the Soviets spent too much on military buildup during a time of peace and ignored the social concerns. USA also had close ties with our Allies, including China, who was starting to side with us after 1972, and the USSR didn’t.

11. Know these major major post-Cold War Events:

-JFK Assassination

Assassination:

November 22, 1963 In Dallas, Texas in the Elite Plaza on a campaign trip
Assinator= Lee Harvery Oswald by a rifle
Govenor of Texas and secret service man were wounded
Kennedy was pronounced dead in Parkland Hospital shortly after brought there
Later Oswald was killed people going into court by Ruby
Harvey was in the marines (sharp shooter; means he has a really good shot)
Harvery has defection to the USSR

-Watergate

President Nixon was very paranoid about not being reelected, he actually thought the whole country was secretly against him, and so, to make absolutely sure that he would be reelected, he sent 5 men into the Watergate hotel to spy on the Democratic Party and their plans. The men weren’t caught the first time but were the second but everyone just wrote it off as a common burglary. Except for two reporters, Carl Bernstein and Bob Woodward, who were curious/suspicious as to why the “burglars” didn’t take any cash, were dressed in suits, and were bugging phones. They eventually gave up on the matter seeing as they couldn’t find anything but then an FBI informant told them to “follow the money” and, sure enough, they found what they were looking for. Nixon was found guilty and would have been impeached, not for the matter but outright lying about it, but he resigned before that could happen.

-Iran Hostage Crisis

Iran had been in the control of US, Great Britain, and France for a long time and they wanted to cut the strings and become independent. The leader of the country, called “the Shaw”, was pretty much a puppet of the countries controlling them. The Shaw fled to the US in very poor health because they were trying to kill him in his country. This new Islamic government took 52 Americans hostage for 444 days. The deal was, give the Shaw back to Iran and let them kill him and they would give back the hostages. We refused saying we weren’t going to do that to him. Iraq eventually invaded Iran and we were able to make a deal with Iran because they were too preoccupied with the new Iraqi invasion.

-Persian Gulf War (1991)

Started when Iraq invaded Kuwait.
Sedan Hussein led this- became a bad guy when he gassed his own people.
Iraq thought Kuwait was using oil across the border.
Invaded in Aug. 1990.
Operation desert shield- sent 1000s of US troops to Saudi Arabia.
Hoped it would prevent invasion by Iraq.
Hoped that it would send a message to Sudan Hussein to get out of Kuwait.
Bombed Iraq and Kuwait for days, then invaded Kuwait, within a month we won.
Our goal was to free Kuwait from Iraqi control.
Negative outcome- destruction of infrastructure. After the war was over, Iraq had to agree to a no fly zone to protect the people in Iraq.
Every day US troops would be flying over those areas. The IAEA sent weapon inspectors to Iraq to make sure they weren't making weapons of mass destruction with nuclear power. Believed they had WMDs but we never found any.

-9-11

What Happened? Two airplanes were hijacked by al-Qaeda, led by Osama bin Laden. Planes crashed into the Twin Towers and fell. 3rd plane was flown into the Pentagon. Not so much damage. 4th plane hijacked and passengers tried to get control of the pane and crashed into a field

What did the country do? Found out who was responsible. Higher security in airports, Act passed that government can listen to phone calls. Bush declared war on tersest. Went to war with Afghanistan, One positive act- we all came together. Dem and Rep came together for about a year.

-War in Afghanistan-

War was a result of the 9/11 attack on the US. We have now currently taken down bin Laden but are still trying to take down the Taliban there. The goal is to be out of the country by 2014.

-War in Iraq-

We went to war there because we thought they had Weapons of Mass Destruction (WMDs). Saddam Hussein had actually wanted us to believe he did, when he actually didn’t, for whatever reason. More than 20 nations invaded Iraq and they took down their government really fast. But they didn’t account for the al-Qaeda or the Taliban that made their way into the country and the big civil war going on at the time. Eventually, we did get out of Iraq (2011) and Saddam Hussein was captured, put on trial, and executed by the people/new gov’t of Iraq, not the US.

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