The Great Depression

• The Great Depression was documented through the camera lens, examples include photos of an 18-year-old migrant worker and her child.
• The US economy was the world's largest at the end of the 1920s.
• Herbert Hoover predicted that the United States would soon see the day when poverty was eliminated.
• The stock market crash of 1929 touched off a chain of events causing the longest, deepest US economic crisis.
• In the months after the stock market crash of 1929, nine thousand banks failed.
• The stock market crash as the single cause of the Great Depression is an oversimplification.
• During the 1920s, American firms earned record profits and reinvested much of these funds into expansion.
• Companies had expanded to the bubble point by 1929.
• Wages increased at a slower pace, widening the distribution of wealth.
• The richest 1% of Americans owned over a third of all American assets.
• Wealth concentration limited economic growth because the wealthy tended to save money.
• Middle-class Americans had already stretched their debt capacities by purchasing automobiles and household appliances on installment plans.
• Banks operated without guarantees to their customers, creating a climate of panic.
• Few regulations were placed on banks, and they lent money to those who speculated recklessly in stocks.
• Agricultural prices had already been low during the 1920s, leaving farmers unable to spark any sort of recovery.
• When the Depression spread across the Atlantic, Europeans bought fewer American products, worsening the slide.
• The American economy was a house of cards at the time of President Hoover inaugurated.
• As middle-class Americans stood in the same soup lines previously graced only by the nation's poorest, the entire social fabric of America was forever altered.

The Market Crashes

• The stock market took a historic nosedive, marking the end of the Roaring '20s.
• STOCK PRICES soared to record levels, making millionaires overnight
• In 1925, the total value of the NEW YORK STOCK EXCHANGE was $27 billion.
• By September 1929, that figure skyrocketed to $87 billion.
• The average stockholder more than tripled the value of the stock portfolio.
• John J. Raskob advised Americans to invest just $15 dollars a month in the market, claiming the venture would be worth $80,000 after twenty years.
• Stock fever was sweeping the nation, or at least those that had the means to invest.
• A MARGIN PURCHASE allows an investor to borrow money, typically as much as 75% of the purchase price, to buy a greater amount of stock.
• Stockbrokers and even banks funded the reckless SPECULATOR.
• Borrowers often paid 20% interest rates on loans
• On October 24, 1929, investors began to sell their stocks at an alarming rate, an event which became known as Black Thursday.
• By October 29, the Great Crash was underway.
• By November 17, over $30 billion dollars had disappeared from the U.S. economy.
• On October 24, 1929, "BLACK THURSDAY," this massive sell-a-thon began.
• By the late afternoon, wealthy financiers like J.P. Morgan pooled their resources and began to buy stocks in the hopes of reversing the trend.
• October 29, the bottom fell out of the market on Tuesday.
• A record 16 million shares were exchanged for smaller and smaller values as the day progressed.
• For some stocks, no buyers could be found at any price.
• By the end of the day, panic had erupted, and the next few weeks continued the downward spiral.
• The value of the entire market was cut in half in ten short weeks.
• Suicide and despair swept the investing classes of America.
• When the stock market crashed on October 29, 1929, few Americans believed that a decade-long depression was underway.
• 4 million Americans had money invested on Wall Street.
• 90% of American households owned precisely zero shares of stock.
• President Herbert Hoover quickly addressed the nation, professing his faith in the soundness of the American economy.
• Banks that improvidently lent money to futures traders to buy stock on margin found that many of those loans would go unpaid.
• Consequently, a rash of BANK FAILURES swept the nation.
• Many consumers who had bought the new conveniences of the GOLDEN TWENTIES on the installment plan were unable to make their payments.
• Businesses began to lay off workers to offset new losses.
• Many manufacturers had overproduced and created huge inventories.
• Unemployment brought even less savings and spending, and the economy slowed yet another notch.
• In 1932 UNEMPLOYMENT rose to 12 million Americans from 1.5 million in 1929.
• The $87 billion 1929 New York Stock Exchange was worth a mere $15 billion in 1932.
• The nationwide unemployment rate was 25%.
• Many laborers were forced to choose between wage cuts and a pink slip.
• Most people who retained their jobs saw their incomes shrink by a third.
• Soup kitchens and charity lines were unable to meet the growing demand for food.
• Thousands performed odd jobs from taking in laundry to collecting and selling apples on the street.
• Millions of backyard gardens were cultivated to grow vegetables.
• Oklahoma was particularly hard hit, as a DROUGHT brought dry winds, kicking up a "DUST BOWL" that forced thousands to migrate westward.
• African Americans endured unemployment rates of nearly twice that of white communities.
• Mexican Americans in California were offered free one-way trips back to Mexico.
• The Latino population of the American Southwest sharply decreased throughout the decade, as ethnic violence increased.
• The fault of the Great Depression was not Hoover's, but he would receive great blame.
• Urban shantytowns were dubbed HOOVERVILLES.
• Newspapers used by the destitute as bundling for warmth became known as Hoover blankets.
• Pockets turned inside out were called Hoover flags.
• Hoover ran for president under the slogan "RUGGED INDIVIDUALISM".
• Hoover signed the HAWLEY-SMOOT TARIFF in 1930, designed to protect American industry from overseas competition.
• Hoover's 1931 economic plan cut federal spending and increased taxes.
• Hoover signed legislation creating the Reconstruction Finance Corporation in 1932.
• This act allocated a half billion dollars for loans to banks, corporations, and state governments.
• Hoover believed government aid would stifle initiative and create dependency where individual effort was needed.
• The ELECTION OF 1932 resulted in Franklin D. Roosevelt won the Democratic nomination.
• Roosevelt promised "a new deal for the American people" that included a repeal of the prohibition amendment.
• Roosevelt earned 58% of the popular vote and 89% of the electoral vote in the election.

Social and Cultural Effects

• Election day brought a landslide for the Democrats.
• Bands across America struck up Roosevelt's theme song — "HAPPY DAYS ARE HERE AGAIN".
• Many family units were strengthened through the crisis.
• Mass migrations reshaped the american mosaic.
• The crime rate rose rapidly as many unemployed workers resorted to petty theft.
• Suicide rates rose, as did reported cases of malnutrition and prostitution.
• Health care in general was not a priority.
• Alcoholism increased with Americans seeking outlets for escape, compounded by 1933 repeal of prohibition.
• Universities saw their student bodies shrink during the first half of the decade.
• High school attendance increased among males.
• Public spending on education declined sharply.
• Marriages were delayed as many males waited before proposing.
• Divorce rates dropped steadily in the 1930s.
• Rates of abandonment increased.
• Birth rates fell sharply.
• Rural New England and upstate New York lost many citizens seeking opportunity elsewhere.
• The GREAT PLAINS lost population.
• The Dust Bowl sent thousands of "OKIES" and "ARKIES" looking to make a better life.
• Classic films like Frankenstein, It Happened One Night, and Gone With the Wind debuted during the Great Depression.
• The popularity of the blues musical form gained popularity.

The Great Depression was a deep economic crisis in the US. Several factors contributed to it, including the stock market crash of 1929, record profits by American firms, wealth concentration, and limited economic growth.