Presentation on theme: "Factors underlying the Prosperity of the 1920s"— Presentation transcript:
1 Factors underlying the Prosperity of the 1920s Mass ConsumptionSpeculation BoomUneven Prosperity
2 Mass ConsumptionChanges in production led to new patterns of consumption (mass markets for goods)More advertisingWorkers with High wages & More time= Greater purchasing powerNew programs for installment purchases and buying on creditSmall down payment to take item home : pay the rest in monthly installments + interestConsumers were able to buy more (and much more expensive) goods.Cars, Refrigerators, washing Machine, Vacuum Cleaner, Furniture, radios, etcOnce one seller offered an installment plan, competitors were usually forced to do the same
3 Speculation BoomSpeculation is the purchase of any item (not for personal use), but in the hope of selling it later at a higher price1920s saw a spread of Speculation – Stock and Real EstateDevelopment of new industries, improved production techniques, and the expansion of mass markets led shares of corporations listed on the stock market to climb to dizzying heightsGains in stock fueled speculation even morePeople read about the success of others and it enticed them to buy stocks for “easy profits”More people bought stocks… stock prices kept going up….
4 Uneven Prosperity WEALTH WAS HIGHLY CONCENTRATED 1929 STUDY SAID THE TOP ONE THOUSANDTH (.1%) OF Americans combined income was equal to that of the bottom 42%Same top group controlled about 1/3 of all savings¾ of Americans had no savings at allMany still in povertyDue to tractors and the spread of electricity, farmers faced lower income due to overproductionRailroads suffered from new competition with carsTextile workers faced lower wages because of foreign competitionMinority groups faced constant discrimination