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Crash & Depression

Crash & Depression. Chapter 32 (Cont.). 4/2011. The Stock Market Crash. 1929. Section 1. The “Roaring 20’s” was coming to an end. Review: Stock Market Boom. Summary: Stock Market Bust. Black Thursday October 24, 1929. The Dow Jones Industrial Average peaked at $381 in September

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Crash & Depression

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  1. Crash & Depression Chapter 32 (Cont.) 4/2011

  2. The Stock Market Crash 1929 Section 1

  3. The “Roaring 20’s” was coming to an end.

  4. Review: Stock Market Boom

  5. Summary:Stock Market Bust

  6. Black ThursdayOctober 24, 1929 • The Dow Jones Industrial Average peaked at $381 in September • By October 24th, stock prices began to fall • Example - GE went from $400 to $283

  7. Black ThursdayOctober 24, 1929

  8. The Market Crashes Panic on Wall Street Investors crowd the sidewalk outside of the NYSE

  9. Black Thursday - October 24, 1929 • Pres. Hoover - business “is on a sound and prosperous basis” • Group of bankers bought shares to stabilize prices • Not enough to stop the panic

  10. Monday October 28, 1929 • Investors continued to sell • Prices continued to drop Investors continued to panic

  11. Black Tuesday – October 29, 1929 • Tried to sell stocks at any price • Bankers called in their margins • Losses totaled $30 billion dollars

  12. High of $381 Low of $34

  13. The Ripple Effect of the Crash • Less people able to buy goods (decline of GNP) • Leads to contraction • Severe contraction = depression • This contraction was so severe, it is known as the Great Depression

  14. The Great Depression -Stock Market Crash to WWII • Approximately 1/3 of US banks failed • Unemployment reached 25% • GNP went from $103 billion to $56 billion

  15. The Great Depression

  16. The Great Depression

  17. Photography by Dorothea Lange

  18. The Worldwide Impact • Countries depended on the USA for capital, markets, and goods • Contractions began in Europe • Result - they could not buy American products • (Germany was particularly hard hit)

  19. Underlying Causes of the Depression • All of the warning signs that were ignored from the 1920’s. • Lack of government oversight • Lack of government response Note: Natural disasters did not cause the Great Depression but effected severity of it

  20. Natural Disasters From floods in the Northeast to droughts in the Midwest

  21. Social Effects of the Depression

  22. Social Effects of the Depression • Hoovervilles • Hobos - approx. 1 million • Farm distress • low prices due to low demand • evictions and foreclosures

  23. Hoovervilles Shantytown in Central Park

  24. Hoovervilles

  25. The Dust Bowl(1931-1940) • Drought and poor environmental practices • Effected Great Plains and the Midwest • Hardest hit were Oklahoma, Kansas, and Nebraska • Top soil blew into the Atlantic Ocean • Created a desert in the center of the USA • Displaced millions of farmers

  26. The Dust Bowl

  27. The Dust Bowl

  28. Flooding in Tennessee

  29. Flooding in Pittsburgh

  30. Poverty Increased Social Problems • Alcoholism, spousal abuse, child abuse, suicide, and violence increased • Health and nutrition decreased • Hoover claimed that no one starved but historians estimate as many as 1 million people died from the effects of the Depression

  31. Poverty Increases Social Problems • Divorce, marriage, and birth rates declined • Homeless people moved in with relatives • “Last hired, first fired” • Lynchings increased • Japanese & Mexicans were deported

  32. Scottsboro Boys • March, 1931 - 9 African Americans were accused of raping two white women • They were convicted and sentenced to die without even seeing a defense attorney • They were later exonerated but not until four of them had spent many years in jail Scottsboro Boys with National Guard

  33. Surviving the Great Depression

  34. Survival

  35. Survival • People helped one another • States provided relief • Local charities assisted millions • Those that survived never completely forgot what it was like to live through the Great Depression

  36. Surviving the Great Depression • People helped each other • Farmers assisted each other • Penny auctions • Violence prevented some foreclosures

  37. Surviving the Great Depression • Estimated 1,000,000 hobos rode the rails • Approx. 250,000 of them teenagers

  38. Hobos

  39. Surviving the Great Depression Hobo Symbols

  40. Surviving the Great Depression • Political movements like the Socialist and Communist Parties gained membership • Entertainment like this new board game provided a pleasant diversion

  41. Dark Humor Helps to Relieve Stress

  42. Signs of Change Prohibition was repealed in 1933

  43. Signs of Change The Chrysler building was overshadowed by the Empire State Building in 1931

  44. Signs of Change • By 1935 • Calvin Coolidge died • Al Capone was convicted of tax fraud • Babe Ruth retired • Lindbergh baby was kidnapped and found dead • America’s heroes were changing

  45. The Election of 1932

  46. President Hoover: • Assured the American people the economy was improving • Insisted it was a normal business cycle • Thought direct relief should come from charity • Asked business leaders to maintain wages voluntarily

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