The Great Depression Reasons it happened and effects on people

Cause #1 Stock Market crashed—Black Tuesday Stock Market crashed—Black Tuesday October 29, 1929 October 29, 1929 Investors (people who owned stocks) lost $40 billion at once Investors (people who owned stocks) lost $40 billion at once Country could not recover from such a loss Country could not recover from such a loss

Cause # 2 Bank Failures—Over 9,000 banks failed Bank Failures—Over 9,000 banks failed Banks were uninsured so people could not get their money back Banks were uninsured so people could not get their money back Banks stopped loaning money because they were unsure the economy would recover Banks stopped loaning money because they were unsure the economy would recover

Cause # 3 People just stopped buying products— consumers couldn’t afford to purchase things or were afraid to purchase big items People just stopped buying products— consumers couldn’t afford to purchase things or were afraid to purchase big items Less items were bought—so people who made those items lost their jobs Less items were bought—so people who made those items lost their jobs Unemployment went up to 30% of the population Unemployment went up to 30% of the population

Cause #4 Smoot-Hawley Tariff—taxed goods coming from Europe to protect American products Smoot-Hawley Tariff—taxed goods coming from Europe to protect American products Europe retaliated and Americans lost money by losing some trade with Europe Europe retaliated and Americans lost money by losing some trade with Europe

Cause #5 Drought in the Mississippi Valley and Great Plains Drought in the Mississippi Valley and Great Plains Created the Dust Bowl—no grass or trees and huge dust storms killed crops Created the Dust Bowl—no grass or trees and huge dust storms killed crops Farmers had to sell their land and leave Farmers had to sell their land and leave

Cause #6 Hoover Administration and Congress cut taxes on the wealthy Hoover Administration and Congress cut taxes on the wealthy Tax rate went down from 73% to 24% Tax rate went down from 73% to 24% Government could not help people with revenue (money coming in to run the government) lowered so much Government could not help people with revenue (money coming in to run the government) lowered so much

Herbert Hoover President during the depression President during the depression Laissez-faire (which means hands off) was his way of handling the needs of people who needed help during the Depression Laissez-faire (which means hands off) was his way of handling the needs of people who needed help during the Depression Businesses should not be coerced to do the right thing Businesses should not be coerced to do the right thing No direct help to people in need—would make them dependent No direct help to people in need—would make them dependent

Hoover (cont) Shacks built by homeless people came to be known as Hoovervilles Shacks built by homeless people came to be known as Hoovervilles Hoover’s policies were said to be too little too late Hoover’s policies were said to be too little too late

Link This link takes you to more facts about the Great Depression (and some New Deal facts) This link takes you to more facts about the Great Depression (and some New Deal facts) s.html s.html s.html s.html

Results of Great Depression Millions out of a job Millions with no home Soup Kitchens (stand in line for one bowl of soup and bread—all day only thing you get) No way to make money Farms closed because of the Dust Bowl— higher food prices—supply and demand

FDR’s New Deal to the Rescue Laws and regulations called the “New Deal” were enacted to help people recover from the Depression Laws and regulations called the “New Deal” were enacted to help people recover from the Depression (more later) (more later)