1. The Great Depression
October 29th, 1929

2. Causes of the Depression
Superficial prosperity
Railroads, textiles, steel – barley made a profit.
Crisis in the Farm Sector
overprotection
Easy Credit - living on credit
Uneven distribution of wealth
Poor decisions made by the government

3. Get Rich Quick plan
Bull Market – long period of rising stock prices = people invest
Margin – people are buying stocks on credit also – 10% down and stockbrokers loaned rest
Example:
1. Person has $1000 but wants $10,000 work of stock
2. The stockbroker loans $9,000
3. When the stock prices rise, investor sell, make a profit and pay
back stockbroker
Speculation – betting that the market would continue to rise.

4. Everything that goes up, must come down
Problems!!
* Stock prices started to fall
* everyone began to sell stocks to
repay loans
* Prices drop further when money
is pulled out
Monday, October 21st, 1929 = Margin Call
Tuesday, October 29th, 1929 – Black Tuesday!!
stock market falls to lowest prices ever

5. Things get worse
Hawley-Smoot Tariff Act - raises tariffs to the highest in history
“If you won’t buy our stuff, we aren’t buying yours” =
other countries stopped buying American goods

6. Hoover’s Beliefs
“Any lack of confidence in the economic future… is foolish,”
“Rugged individualism” – people should succeed through their own efforts.
Help should come from individuals, charities, and local organizations
Everyone should work together to get through

7. Herbert Hoover: A Lifetime of Acheivements

8. Hoover’s Response Boulder Dam – jump start the Economy and add jobs
Federal Farm Board – raise crop prices by keeping some off the market
Reconstruction Finance Corporation - Gov. provides money for banks, insurance co. and large business.
Trickle
Down
Federal Home Loan Banking Act – Lowered mortgage rates so homeowners and farmers can refinance

9. The Great Depression in America

10. Bonus Army 10,000 – 20,000 WWI veterans arrive in D.C.
Want a bonus promised to Bonus Army them for wartime service
At first, Hoover provides food and supplies to veterans
July 28th, 1932 Hoover decides that veterans should leave
General MacArthur and Major Eisenhower force veterans to leave.

11. Hoover vs. World War I Veterans

12. “The Dust Bowl” Causes: 1. overproduction 2. drought 3. wind
4. no grass, crops, or
trees
One Solution – move west to California = Okies = migrants

13. Farmers and their lost dreams – The Dust Bowl Years

14. Hoover’s approval rating goes
Defeated easily in 1932 by Democratic candidate Franklin Delano Roosevelt