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Bell Ringer

Bell Ringer. What time period does this cartoon depict? Describe what is meant by the caption at the bottom?. Question #1. What do you think caused the Great Depression? How does that relate to the era of the 1920 ’ s?. SSUSH17 Analyze the causes and consequences of the Great Depression.

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Bell Ringer

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  1. Bell Ringer What time period does this cartoon depict? Describe what is meant by the caption at the bottom?

  2. Question #1 • What do you think caused the Great Depression? • How does that relate to the era of the 1920’s?

  3. SSUSH17 Analyze the causes and consequences of the Great Depression.

  4. Causes: LONG-TERM: SHORT-TERM: Stock Market Crash (Oct. 1929) Also known as “Black Tuesday” • Bank loans • Overproduction • Underconsumption • Unemployment • Stock market speculation • Buying on the margin

  5. a. Describe the causes, including overproduction, underconsumption, and stock market speculation that led to the stock market crash of 1929 and the Great Depression. Farmers Overproduce: -The wide spread switch from horse-drawn to mechanized farm equipment allowed farmers to increase their production of crops -Instead of making more money though, overproduction led to major price reductions, causing farmers to lose money and the inability to pay back farm loans -The result of farmers failing to pay back loans led many small town banks to fail, creating a strain on other banks

  6. Underconsumption • Though more efficient machinery in factories and on farms led to overproduction, few consumers had the money to purchase these goods • The average consumer had very little buying power • Underconsumption led to lower prices which resulted in the loss of money for farmers and manufacturers What happens to factory workers if the product they produce isn’t being purchased?

  7. Causes of the Great Depression Discuss: How do these diagrams help you to understand the causes of the Depression?

  8. Stock Market Speculation • In the late 1920s many Americans began to invest heavily in the stock market • Americans invested in high-risk stocks that would allow them to make a lot of money quickly, or lose a lot of money quickly

  9. Causes of the Crash • Speculators were those who tried to make quick money on the stock market: -Many speculators bought stock on margin -Buying on margin means that speculators borrowed money to buy stocks: this works if the stock price goes up, but is disastrous if the stock price falls -Many speculators of the 1920s borrowed 90% of the stock’s value (If a stock cost $100, you would borrow $90. If the stock price began to fall, you would then have to pay back the money you borrowed-which many speculators didn’t have!)

  10. Stock Market Crash: • Oct. 1929 • “Black Tuesday” • Sparked a chain of events that quickened the collapse of the US economy • Americans, fearful of the dip in stocks, tried to withdraw their money from the banks, causing the banks to fail

  11. Great Depression: • Worldwide economic depression that took place from 1929-1941 (beginning of World War II) • 1933: lowest point of the Depression; over 15 million Americans were unemployed & over half of the nation’s banks had failed

  12. b. Explain factors (including over-farming & climate) that led to the Dust Bowl & the resulting movement & migration west.

  13. Dust Bowl • When farmers were unable to pay back their loans, many stopped planting crops • In 1932 a drought hit the Great Plains, turning much of the top soil into dust-with the lack of rain and crops, wind blew the dried soil for hundreds of miles

  14. Farming & climate: • New farming techniques made drought conditions worse • Grass originally held topsoil in place but due to over-farming, grass began to disappear & could not longer do the job

  15. Migration: • Families trapped in the Dust Bowl were forced to move out of the Great Plains • Dust Bowl refugees were known as “Okies” although many did not come from Oklahoma • Most packed up old trucks & headed towards California, Oregon, or Washington to find jobs

  16. Question #2 • Who was President at the beginning of the Great Depression? • Who will be elected President during & after the Great Depression?

  17. c. Explain the social and political impact of widespread unemployment that resulted in developments such as Hoovervilles.

  18. Herbert Hoover: • 31st President • In office from 1929-1933 • Previous Presidents contributed to the stock market crash, yet Hoover was blamed by Americans • Did not recognize the severity of the situation & did little to help Americans • Believed in little governmental involvement to help

  19. ` • As more workers lost their jobs, they were unable to pay their rent or mortgage and were evicted • This new class of homeless began to build shacks on the outskirts of cities called shantytowns, or Hoovervilles. Why did people call shantytowns “Hoovervilles”?

  20. Exit Card • What economic factors caused the Great Depression? • In what ways was the Great Depression similar to the Great Recession that we are currently coming out of? • What is the difference between a Recession and a Depression?

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