The Great Depression

Semester 2: Week 5 Notes

Causes
There were multiple explanations for the decade
of depression which followed the roaring 20s

Backfire
Many things in the 1920s began to make investors
skeptical of how well the economy was doing
1. The wealthy and poor were becoming further divided
2. Too many stocks were being inflated by margin
(Credit) buying
3. Farmers were struggling with low prices and
overproduction since the wars end
4. Isolationist tariffs limited the market in other nations
for US Goods
5. US Factories had overproduced and Americans were
under consuming by 1929

The
Crash
In October 1929 investors began selling off
their stocks.
1. This prompted other investors to rush to
sell their shares
2. The market plunged by over 1/3rd its value
3. In one day, black Tuesday the market
lost $10-15 billion
4. The crash wounded the nations economy
fostering a decade of economic depression

They closed the stock exchange to outside

visitors because the panic was so bad.

Hoovers
Response
During the lead up to his election in 1928 Hoover
promised that the good times were here to stay.
He promised A chicken in every pot
1. Hoover was a laissez-faire republican who
wanted to support business get out of the
slump..
a. Tried to get factories to promise to keep open
b. Tried to get more money into the economy

2. Hoover was reluctant to provide relief to the

people in direct payments.

The Peoples
Response
People turned on Hoover as they saw
him not doing anything for their needs.
1. Hunger marches throughout the
nation
2. Farmers revolting by destroying
crops in hopes of driving up prices
3. The homeless build Hoovervilles
out of scrap materials

Hooverville

Bonus Army Fiasco

A group of WWI veterans were promised a cash
bonus ($1,000) for their service to be paid in 1945
1. Veterans and their families marched to
Washington and set up a Hooverville to get
their bonus payments early.
2. Senate voted to deny the early payment
3. Hoover sent US Military to clear out the
remaining veterans
4. 2 veterans were killed in shootings, gassing, and
mayhem that followed

Bonus Army

The Dust Bowl

To add insult to injury a prolonged
drought combined with over-farming
caused massive crop failures
1. Many farmers were forced to
migrate west

A New Deal
During the election of 1932 voters were ready
for a fresh approach to combat the Great
Depression
1. NY Democrat Franklin Delano Roosevelt (FDR)
was promising a New Deal
2. FDR was promising to kick the depression
with his three Rs
a. Relief
b. Recovery
c. Reform