Write a paragraph ISN Page 65 In your opinion, what causes the economy to go bad? Why do we have “good” economic times and “bad” economic times?” Explain.

The Economic Collapse of the 1920’s “The Great Depression”

ISN Page 66 Create a Cause and Effect map Place a small box inside and write: Effect: The Great Depression Create six boxes around it pointing to the effect, in these you will place the causes

Causes of the Great Depression Objective: To explore and understand the six factors that caused the “Great Depression.” Essential Question:

Postwar Economic Boom, visual A Twenties Prosperity “Roaring Twenties” Increased income Factories increase production Increased stock trades

The Depression Foreshadowed Unemployment is rising Farmers losing land Falling stock prices October 29, 1929

Six Key Factors Contributing to the Great Depression 1.Republican domestic and international economic policies. 2.Unchecked stock and real estate speculation. 3.Weak and unregulated banking institutions. 4.Over production of goods. 5.Decline of the farming industry. 6.Unequal distribution of wealth.

1. Republican Economic Policies, Visual B Trickle down economics Did not work Work place corruption Economic problems in Europe

2. Unchecked Stock & Real Estate Speculation, visual C Risky real estate investments Real estate fraud Misleading beliefs in the stock market Crooked investors

3. Weak & Unregulated Banking Institutions, visual D Laissez Faire “Leave Alone” “Hands Free” Over-extension of credit to stock investor & brokers Families lost savings Could not sell stocks Increased unemployment = defaulting mortgages 1932 ¼ of US banks closed Almost 6,000 banks

4. Over Production of Goods, Visual E New technologies High consumer demand More goods in less time Agricultural problems

5. Decline of the Farming Industry, visual F Farming = US backbone Failed to sale surplus goods Default on bank loans & mortgages farmer income down 50% Drought hits the mid-west “Dust Bowl” Farmers move west

6. Unequal Distribution of Wealth, visual G The rich got richer… 1929 Wealth 1% of America’s population held 59% of the nations wealth 60% of American’s made less than 2K/year Many minorities made less than 2K/year Replace workers with machines Purchasing power was lost

The End