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“Boom” to “Bust”

“Boom” to “Bust”. 1929-1941. The Stock Market. As more people had extra money in the 1920’s, many started to invest in the Stock Market. Question: What is a stock and what is the Stock Market?

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“Boom” to “Bust”

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  1. “Boom” to “Bust” 1929-1941

  2. The Stock Market • As more people had extra money in the 1920’s, many started to invest in the Stock Market. • Question: What is a stock and what is the Stock Market? • Answer: Stocks are small pieces of a company. When you own a stock or “share” you own a part of that company. If the company does well, you make money, when it does poorly….. • The Stock Market is literally the buying and selling of shares in many different companies in an effort to make money. • Question: Why would a company sell stock or shares in that company?

  3. “Bull Market”- When the stock market is doing well and prices are going up. “Bear Market”-When the stock market is doing poorly and prices are going down. “Margin buying”- The practice where people could buy a stock while only putting down 10%and borrowing the rest. Many would sell the stock at a higher price and pay off the money they borrowed. This worked ok until a “margin call”. (Click on “crash” on the wiki) “Speculation”- The practice of buying and selling shares to make a quick profit. This works during a “bull” market but not during a “bear”.

  4. October 1929 • A large number of investors nervous about the economy, started selling off their stocks all at once leading to a panic as others started to sell theirs as well. Stock brokers made margin calls to people who owed money. To cover what they owed, people sold more stocks…

  5. “Black Thursday” and “Black Tuesday” October 29, 1929(The Stock Market Crash) • Causes: • Stock speculation • Margin buying (margin calls) • Installment buying(buying on credit) • Debt • Results: • “Run” on the banks • Loss of trust in banks • People defaulting on loans taken from the banks and bank collapses

  6. President Hoover and the Crash “Pull yourself up by your bootstraps”- No whining just work harder! “Volunteerism” instead of government aid (The Salvation Army, Red Cross, soup kitchens, churches, neighbors) Publics works programs like the building of the “Hoover Dam” The Reconstruction Finance Corporation or “R.F.C” (loans from the government to keep businesses and banks afloat)

  7. The “Bonus Army” in 1932 (or the nail in Hoover’s coffin)

  8. President Franklin Delano Roosevelt and the Great Depression • What was the first thing FDR did to try and stem the momentum of the Depression? • What was the “New Deal”? • “Alphabet Soup Programs” (CCC, WPA, NIRA, TVA, etc.) • Did the New Deal programs help? What were some of the reactions to the “New Deal”? • The Supreme Court and the New Deal

  9. A Great Depression “hodgepodge” • Hoboes and Okies: • The “Dust Bowl” and “Black blizzards” • Some famous people during the 1930’s

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