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The Great Depression Chapter 22 Sec 1&2 Many American industries werent making large profits. –Steel, railroads, cars, construction, coal mining, lumber.

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Presentation on theme: "The Great Depression Chapter 22 Sec 1&2 Many American industries werent making large profits. –Steel, railroads, cars, construction, coal mining, lumber."— Presentation transcript:

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2 The Great Depression Chapter 22 Sec 1&2

3 Many American industries werent making large profits. –Steel, railroads, cars, construction, coal mining, lumber. Housing sales stopped. So what, why do I care!! What do you need to put in a new house?

4 Causes of the Great Depression 1. American policies and tariffs cut down the foreign market for U.S. goods. 2. Overproduction by farms. –Annual Farm Income 1919= $10 Billion 1921= $4 Billion 3. Overuse of Credit- people were in debt. –They buy less goods 4. Unequal Distribution of Wealth. –70% of the nation made less than $2500 a year. –½ of homes had electricity. –Couldnt afford consumer goods. –While the income of wealthiest 1% increased by 25%.

5 In the late 1920s on farms… Overproduction made prices fall. Farmer got loans for machines and produced more. (sound familiar) Price fell more. Farmers defaulted on the loans and s lost farms. Rural banks that gave loans failed.

6 Peoples received lower wages. They still wanted the nice things they were used to having, so they used… CREDIT- Why is this dangerous? When the debt became too big, people stopped spending.

7 Election of 1828: Herbert Hoover Wins!! Many invested their wealth in the Stock Market People were engaging in speculation. –Seeking quick return investments –Ignoring the risk involved Buying on Margin= Buying stocks with borrowed money. –If stock prices fell, they could not pay off the loans

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9 Then….

10 What was Black Tuesday? On October 29 th 1929, the stock market crashed. Investors hurried to sell stocks before they were worthless. $30 billion dollars in stock became worthless overnight million shares of stocks were sold that day. Others could not be sold and became worthless.

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12 The Effects of the Stock Market Crash Americans panicked took money out of banks. Banks lost money and couldnt pay customers By ,000 of 25,000 banks n the U.S. had failed. 9 million savings accounts disappeared. 90,000 businesses closed. 25% of workers were out of work by Those with jobs had pay cuts.

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20 More Results!!! (These are from Ch 14 sec 2) Shanty towns Soup kitchens/Breadlines –Run by ? Increase in Racism 400,00 farms lost to foreclosure

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29 The Dust Bowl –Drought in the Plain states Hobos ( ) 24,647 killed for tresspassing 27,171 injured on railroad property Okies 2600 Schools shut down 300,000 studen Suicide rate up 30%

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32 Americans were: Americans were: struggling demoralized without hope And finally…

33 The government wanted a quick solution so they passed… The Hawley Smoot Tariff act. –It created a tariff on foreign goods. It made things worse. –Other countries stopped buying our stuff too.


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