Prosperity Shattered

Chapter 24 Section 1

• A. Economic Troubles on the Horizon– Hoover told the people that the USA is strong– People started to purchase on credit• $7 billion by 1929

– Playing with the market • Bull• Bear

– Margin Buying• Purchasing stocks with borrowed money

• B. The Stock Market Crashes– Black Thursday—October 24, 1929• Investors sold shares

– Black Tuesday—October 29, 1929• Dumped 16 million shares• People couldn’t cover loans by selling stocks

• C. The Depression Begins– The President said it was minor and we could

recover quickly– Banks Stared to close • 1930-1932—5000 banks failed

– Businesses failed also 28,285 in 1931– 1926-1933, GNP halves to $56 Billion– Unemployment in 1932 = 23.6%

• D. What caused the Great Depression– Economic troubles in Europe– WWI– Large business surpluses – Smoot Hawley Tariff of 1930

Hard Times

Chapter 24 Section 2

• A. American workers face unemployment– 1929—1.5 million unemployed– 1939—15 million unemployed– Wages fell 1/3• Some made only $0.10 an hour

– Hours decreased• People sold apples on the streets

• B. Life in the City– The city was rough• People fighting for garbage

– Breadlines were long• Shantytowns were set up

– Hoovervilles

• C. Life on the Farm– Farms were foreclosed• Banks couldn’t get their money

• D. Family Life– Marriage rate fell– Births declined– 20,000 Americans committed suicide• 1929-32—28% increase

• E. Popular Culture – Movie attendance rose– Number of radios increased• 12 28 million

– Reading of comic books increased

Hoover’s Policies

Chapter 24 Section 3

• A. Hoover’s Philosophy– Individual Effort not government assistance• People should support gov’t—not vice versa

– Would inflate federal budget– Rugged individualism– Volunteerism should help the people out of the

depression

• B. Boosting the Economy– Secretary of Treasury—Andrew Mellon• Laissez Faire

– Building of the Boulder Dam• 800 buildings• 37,000 miles of road• $800,000,000 for construction

• Created Federal Farm Board– Help farmers help themselves

• Reconstruction Finance Corporation– Stabilized banks“Short depression would be good for the country”

• C. Rumblings of Discontent– Hoover was hated– Bonus Army—10,000 WWI vets wanted pension• Forced off capital

• D. Election of 1932– FDR won 42 states• Hoover won 6