1. Consumerism in the 1920’s

2. Consumerism- the theory that an increasing consumption of goods is economically desirable, or the actions of buying by the public
American’s were very confident about the economy in the 1920’s.
3 main factors contributed to consumerism
Mass Production of Goods
Advertising
Creation of Credit and installment buying
Consumerism

3. Mass production made technology affordable to the middle class in the 1920’s
The automobile industry profited most from mass production. ($300 for Model T)
The biggest impact of early mass production was in manufacturing everyday items, such as glass and canned food.
Basic appliances were invented, radio, phonographs, etc were all in high demand
Mass Production

4. Radio advertising became the grandstand for mass marketing
Radio advertising became the grandstand for mass marketing. Radios were expensive but they were viewed as a necessity by consumers.
Watching a movie was cheap and accessible, wildly popular due to advertisement on radios and movie posters. Advancements in movies..
“Talkie” motion pictures were innovated
First “talkie” was The Jazz Singer
First animated film was Steamboat Willie
Advertising

5. Credit- the ability to buy goods or services before payment, based on the trust that payment will be made in the future
Credit available to more people in 1920s
Credit helps businesses boost their profit and sales
People also bought using installment plans., pay small amounts toward the final purchase
Creation of Credit

6. Stock Market
Stocks portrayed as a reliable and smart investment for the future in the 1920s
A large number of people bought stock so the stock market prices began to rise
Seen as a way for short term investment to become rich quick...speculation fueled more buying and higher prices
People borrowed money to buy stock…”buying on margin”
As long as price stayed high, things were good…price drops, market drops

7. Problems Caused by Economy of the 1920’s
Government in the 1920’s took a “hands off” approach to regulating businesses for the most part.
This laissez faire attitude meant businesses made more profits, but made riskier business decisions.
Problems Caused by Economy of the 1920’s

8. Problems Caused by Economy of the 1920’s
1920s: the people of America were confident that the economic ”boom” would go on forever.
The caused a big problem. The factories were making too many goods. (known as overproduction)
People were over-speculating in the stock market…anticipating stocks would always go up, up, up!
Inequality in wealth also contributes to the upcoming “crash” of the late 1920’s
Consumer buying eventually slows down
Problems Caused by Economy of the 1920’s