The Great Depression

Causes, Consequences, and New DealSOL: VUS.9c

Causes of the Stock-Market Crash of 1929

Overspeculation on stocks. Using borrowed money to

invest in businesses and stock.

Couldn’t pay back once stock market crashed on October 29, 1929.

Bank failures 1930’s saw 9,000 banks

close. Surviving banks stopped

giving out loans. People made “runs” on the

banks.

Causes of the Crash cont…

Reduction in purchases made by people. Production slows People lose jobs Less money in circulation Unemployment rose above

25%. Smoot-Hawley Tariff 1930

America taxed imports on trade from other countries.

Other countries began taxing our goods. Trade ceased.

We had a lot of supply but no market to sell to. Businesses closed.

Consequences of the Stock Market Crash

People rushed to the banks to take out their money in fear of losing their life savings.

People stopped investing money into the economy.

People stopped spending money.

Less money in circulation (hoarding money).

The Great Depression Sets In Stock Market Crash of

1929 caused a ripple effect of the economy into a deep depression.

Federal Reserve couldn’t control the amount of money in circulation. (money in jars/under the mattress)

Economy couldn’t thrive without foreign trade. (Hawley-Smoot Tariff 1930)

Impacts of the Great Depression

Unemployment and homelessness “Hoovervilles”

Bank closings People lose life savings

Public Issues Labor Union violence

Foreclosures on farms which causes migrations. Due to drought Farmers of mid-west

migrate west to California

Where did the people turn?? Franklin Delano

Roosevelt (FDR) Cousin of Theodore

Roosevelt Became 32nd

President in 1933 in the midst of the Great Depression.

Handed the task of getting the country out of the Great Depression.

FDR’s “Fireside Chats”

A series of 30 radio programs delivered directly to the homes of people from 1933-1944 by President Roosevelt.

Appealed to the people by speaking in language they could understand and comforted their fears.

Spoke as a normal member of society.

FDR’s “New Deal”

“We have nothing to fear but fear itself.”

The New Deal changed the role of government in the economy.

It also changed the attitudes of people towards the role of government.

Now citizens depend on the Federal Government to “fix” their problems and to take care of them in times of need.

Major Provisions of New Deal

WPA (Works Progress Administration) Gave money directly to families

to maintain homes and food. AAA (Agricultural Adjustment

Administration) Idea to pay farmers to limit

amount of crops harvested FDIC (Federal Deposit

Insurance Corporation) Attempt to promote deposits in

banks by insuring money deposited by customers.

Social Security Act Payments made to retired and

unemployed due to illness or injury.

Images of the Depression

Dorthea Lange Famous

photographer of this time period.

This picture is a representation of the Great Depression.

Images of the Depression

Images of the Depression

Images of the Depression