The Crash & The Great Depression

Brother, can you spare a dime?

Why Did The Stock Market Rise So Much During the Late Twenties?

• Unreal share prices• Investors speculation

This speculative rise is called a “Bubble.”

And we all know what happens to bubbles.

Why Did The Market Crash In October,1929?

• A bubble can only expand . . . • Once the new money runs out . . .

In Three Weeks, The Market Lost . . .

$30 Billion

Millions Of Americans Become Unemployed.

How Did The Stock Market Crash Weaken Banks?

• 1. Banks had loaned money . . . • 2. Banks had invested. . . .

Bank Losses Led To A . . .

Bank Run!

When A Bank Collapsed . . .

How Did Uneven Wealth Distribution Cause The

Depression?• The middle-class didn’t have enough

money to buy all the goods America was making.

• Demand crashed.

The Demand Crisis

How Did Loss Of Export Sales Cause The Depression?

• Congress passed a heavy tariff on imports. (Why?)

• Foreign countries passed their own tariffs in revenge.

• Exports sank, which meant another reduction in demand.

The Demand Crisis

What About Mistakes By The Federal Reserve?

• The Fed sets the nation’s interest rates.

• During the Depression it raised rates, which reduced the people’s ability to spend.

• Again, demand was reduced.

The Demand Crisis

To Make Things Even Worse, An Environmental Crisis Came Along.

The Dust Bowl

In Search Of Work, Many Unemployed People . . .

• Rode the rails.

President Hoover Opposed Federal Unemployment Relief

• Only state and city governments should dole out relief.

• Charities could provide sufficient relief until the economy improved.

• Individuals should be responsible for taking care of themselves.

• (Does this sound familiar?)

Newly Homeless People Put Up. .

• “Hoovervilles.”

By 1932, America Was Looking For A Savior.

What Was The New Deal?

What Ideology Was The New Deal?

• What have you got that will work?

What Were The Key Elements Of The New Deal?

• Civilian Conservation Corps (CCC)• Tennessee Valley Authority (TVA)• Agricultural Adjustment Act (AAA)• Federal Deposit Insurance

Corporation (FDIC)• Securities and Exchange Commission

(SEC)• Is there a common thread here?

How Did FDR Pay For The New Deal?

Did The New Deal Work?

What is Social Security?