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- 1. Boom to Bust
- 2. Thursday, October 24, 1929, Page 1, Col. 1 PRICES OF STOCKS CRASH IN HEAVY LIQUIDATION, TOTAL DROP OF PAPER LOSS $4,000,000,000 ---------- 2,600,000 Shares Sold In The Final Hour In Record Decline ---------- MANY ACCOUNTS WIPED OUT ---------- Bankers Confer On Steps To Support Market - Highest Break Is 96 Points
- 4. Wall Street on Black Thursday
- 5. Black Tuesday • October 29, 1929 • Stock Market Crash
- 9. • Americans tightened their belts which contributed to the depression
- 11. GREAT DEPRESSION
- 12. Causes of the Great Depression 1. Demand for goods declined, which caused industrial output to slow
- 13. 2. Overuse of credit
- 14. 3. People bought real estate and stock in hopes of selling it quick for money
- 15. Stock Prices Company 3/3/28 9/3/29 American Can 77 181 AT&T 179 304 General Electric 128 396 Montgomery Ward 137 466 Union Carbide 145 413
- 16. • Investors bought on margin – paid only 10% at first and borrowed the rest
- 18. The Depression • Run on Banks – people withdrew all their money causing the banks to run out of money and they had to close
- 20. • Unemployment – 1 out of every 4 workers were unemployed
- 21. Hoovervilles • Cardboard shacks sheltering homeless people
- 22. Hoover blankets • Newspaper used for covering on cold nights
- 23. Hoover flags • Empty pockets turned inside out
- 24. Dust Bowl • Huge dust storms on the Great Plains • Caused “black blizzards”
- 30. President Hoover’s Plan • Hoover didn’t believe in a dole (or handout) • Wanted people to work for their money • Also wanted to try to keep the US budget balanced
- 32. • Reconstruction Finance Corporation – Loaned $2 billion to businesses for projects and to employ more people
- 33. Bonus Army • Group of WWI veterans who were promised a bonus who wanted it early • Douglas MacArthur was sent in to get rid of the army
Notes de l'éditeur
- Laborers worked fewer hours or were laid offConsumer spending had dropped There was no one to buy the goods
- People were having to make high payments on things they bought on credit that they could not afford to buy anything new…Merchants who had extended the loans lost money and their businesses began to falter
- Some did make a profit (early on)Some were swindled into buying undesirable land and even swampsThey assumed that the stock prices would keep going up no matter what the industries didStock prices were 400 percent higher than four years ago
- This was fine as long as the stock went up, but when it went down, the buyer’s margin was “called in”…the speculator would either have to pay or lose his stock
- Allowed purchasers to follow price changes almost as they happened
- Withdrew money to pay their brokers…others withdrew all their moneyBanks helped to cause the problem by unwise extension of creditBy 1931, 5000 banks had closed its doors…some for good…others re-opened, but could only pull out a percentage of your money
- People bought less because they had less money. As they bought less, inventories of goods increased. Producers had more than they could sell. Prices fell, but no one had money to buy the cheaper goods.People helped those who needed it…limited help came from local governments…almost no help came from the federal government
- Built homes out of tents, tar paper, box wood, cardboard, car parts, spare lumber, and scrap metal
- First it was overgrazed by cattle and plowed into farmsThen winds whipped the topsoilLivestock died of thirst…dust pneumonia
- Because he was president, he received most of the blame for the depressionWorkers built the Hoover Dam under the federal government
- Congress defeated the bill…several veterans left, but several stayedWas to be paid out in 1945, but they wanted it in 1932Hoover was criticized for treating them harshly…2 died and 2 were wounded