We talked again about interest, pooling and not getting into credit card debit.
credit card companys love college students cause we don't have a lot of money.
lowing interest rates encourages people to buy more things. and borrow money. buying things are good for buying things by businesses making money. Then the business multiplies then that means hiring more workers. increase interest rates means stock prices would go down. they thought stock market was getting low so they raised interest rates. it was booming in the 20s by borrowing money.
This is a tough topic. so we have to work really hard to understand.
buy low sell high on stocks. that's what its all about!
What are the causes of the Great Depression?
--Main Reasons:
Stock market crash
Bank failures
Reduction in purchasing across the board
American economic policy with Europe
Drought conditions
~Stock MArket crash. many people invested all their money in the stock market
lost more then 40 billion dollars all though the stock market gained back some stocks it just wasn't enough.
~Bank Failures
over 9,000 banks failed. lots of people lost their savings. Banks that survived had no idea if they were going to survive for sure now.
~Purchasing across the board
wberone stopped buying items because they feared that more economical problems would occur.
this led to a reducton in numbers of items made and reduced the workforce. K
~Economic Policy with Europe
Business began falling
Government created the smoot-hawley tariff. Smoot-hawley tariff= to protect american companies in 1930. it charged a high tax for imports
Fifth cause drought caused people not to pay their taxes and debts.
People had to sell their farms for no profit era names the dust bowl. dust bowl=destroyed ag parts
- Children: would write to president for help.. shoes, clothing, money
Boxcar kids- children that ran from home and lived on railroads. Child labor laws formed. Girls dressed like boys. Ran from home
women: Men and women were affected differnt. Men felt like failures. women felt as if their household jobs were enhanced. not a lot of money to live off.
Men: went around looking for jobs. lost self esteem. left their families alot and in a 1940's survey 1.5 million men left their wives.
families: Marriages were put off bc they couldnt afford and same with divorce and birth rates dropped bc not enough money and income dropped severly. some families it made them stronger and others i tore them apart.
farmers: corn prices dropped 5 to 10 percent a bushel and they were burning their corn for heat. they lived off their land and got all food from their. they did a lot of bartering to things they need. children wore flour sack clothing
wealthy people: they werent affected. 40% of the country were not affected and they would try to help out the poor. they didnt notice the suffering. some lost a lot of money. the bragged about their wealth.
Living conditions: hoovervilles- a town made from any kind of material found. Homeless were living anywhere they could in parks and under news papers.
jobs: white men mostly got the jobs. women were thought to be stealing jobs from men so women would get fired and men would get the jobs. You had to have a job to live. 25% unemployment.
Dust bowl: drought and over plowing. 8 years long. worse drought ever.
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