2 Questions to think About What were some of the causes of the Great Depression? What made it so severe, and why did it last so long?What was the impact of the depression on farmers, minorities, and women?How did President Hoover and his administration try to deal with the Depression? What was the results of those efforts?
4 Bank Runs Easy Credit Domestic Reasons Fractional Reserve Lending Reduced Consumer SpendingFractional Reserve LendingBuying on MarginLoans for Stock PurchaseEasy CreditBank RunsOver-Production
5 Inflation BANK of England Overseas Reasons WWI Reparations International DebtHigh American TariffsInflation
6 International Monetary Policy During WWICountries go off the Gold StandardBritish Central Bank looks to keep their dominance over world Financial markets through the League of NationsThey were trying to protect their gold
7 If return to Gold Standard After WWIWhy?Before WWI1 Pound = $4.86After1 Pound = $3.50If return to Gold StandardNo Gold Standard30% Loss
8 All Countries Inflate Currencies to keep prices competitive Britain’s ProblemBritish Manufacturers Could not cut wages because of Unions creating less ProfitsAll Countries Inflate Currencies to keep prices competitiveGold Prices Rise
9 Keep Pounds at Inflated Level Britain’s SchemeWant to save ExportsKeep Pounds at Inflated LevelHigh TariffsBritish Manufacturers Could not cut wages because of Unions so they need low prices
10 Germany redeems Pounds for Gold to pay loans The CollapseLoansGermany redeems Pounds for Gold to pay loans
11 Germany redeems Pounds for Gold to pay loans The CollapseGermany redeems Pounds for Gold to pay loansWith Less Reserves US Banks begin to CollapseMargin Calls
12 “The Crash” “Black Tuesday” October 29th 1929 Panic $40 Billion lost Banks closeUnemployment goes to 20%Farms close
16 Public Works President Hoover’s Solution Smoot-Hawley TariffPresident Hoover’s SolutionReconstruction Finance Corporation“Loan Program”Voluntarism“No cuts to hours or wages”Agricultural Marketing Act“Parity”Public Works“Hoovervilles”
17 Bonus Army 1932 20,000 vets go to DC to demand payment Hoover sends army to evacuate VetsRiot ensuesMakes Hoover Look BadHoover is blamed for Depression
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