Retroviruses and Retroposons Chapter 22. 2 22.1 Introduction Figure 22.1.
22.1: The Nation’s Sick Economy OBJECTIVES: Understand the causes of the Great Depression.
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Transcript of 22.1: The Nation’s Sick Economy OBJECTIVES: Understand the causes of the Great Depression.
22.1: The Nation’s Sick Economy
OBJECTIVES: Understand the causes of the Great Depression
Economic Troubles Brewing• Big industries (steel, textiles,
railroads) not making profits
• Diminishing demand for new products and new construction
• Agricultural business withering
• Congress passes price supports for farmers
• Pres. Coolidge vetoes price supports twice, 1927 & 1928
HOW ARE THESE BUSINESS CHANGES RELATED TO WWI?
“Farmers have never made money. I don’t believe we can do much about it.”
Innovation EX: Ford’s
Assembly Line
Increased Production
AdvertisingIncreased Consumption
Increased Credit
Increased Profits
THE MASS-CONSUMPTION ECONOMY
=BAD HABITS
CONSUMER’S BAD HABITS•Americans are buying less. Why?
•Business are producing more. Why?
•Americans use credit more. Why?
OUTCOME: The gap between rich and poor was rapidly spreading.
FACT: In 1929 5% of US controlled nearly a third of its wealth, while 40% of US only has 10% of its wealth.
ELECTION OF 1928
CANDIDATES:Al Smith runs for DemocratsHerbert Hoover runs for Republicans
ISSUES:Smith’s Catholicism, opposition to prohibition, and connections to NYC
VERSUS the apparent prosperity under
Republicans
OUTCOME: Hoover wins handily.
http://fisher.lib.virginia.edu/collections/stats/elections/maps/1928.gif
STOCK MARKET CRASH
CAUSES
• Buying on margin
• Speculation
• Why did these things contribute to the stock market crash?
STOCK MARKET CRASHEFFECTS
• Black Tuesday (10/29/29)
• Run on banks
• Great Depression
http://www.ambrosevideo.com/resources/docs/56.JPG
BEGINNING OF THE GREAT DEPRESSION
CAUSES EFFECTS• Old and decaying
industrial base
• A crisis in the farm sector
• The availability of instant credit
• An unequal distribution of income
• Hawley –Smoot Tariff
• Buying on margin
• Falling demand for consumer goods
• Dow Jones Industrial Average drops from 38181
• Gross Nat. Product cut in half!!!
• Unemployment rises to 25%!!!
• Interests rates fall, people borrow $ and fall into deeper debt
• Collapse of investment and banks
• Global Depression
TERMS• Price support
• Credit
• Alfred E. Smith
• Speculation
• Buying on margin
• Black Tuesday
• Great Depression
• Dow Jones Industrial Average
• Hawley-Smoot Tariff Act
• Summarize some of the problems threatening the American economy in the late 1920s
• Describe the causes of the stock market crash and of the Great Depression
• Explain how the Great Depression affected the economy in the United States and throughout the world