Ch. 9 The Great Depression Begins

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margin call
Demand by a broker that investors pay back loans made for stocks purchased on margin.

bull market
A period of increased stock trading and rising stock prices.

Black Tuesday
A name given to October 29, 1929, when stock prices fell sharply.

speculation
An involvement in risky business transactions in an effort to make a quick or large profit.

Hoovervilles
Shanty towns that the unemployed built in the cities during the early years of the Depression; the name given to them shows that the people blamed Hoover directly for the Depression.

Dust Bowl
A nickname for the Great Plains regions hit by drought and dust storms in the early 1930s.

Walt Disney
Brought Mickey Mouse to life in 1928, produced the first feature-length animated film, Snow White and the Seven Dwarfs, in 1937. “racist”

John Steinbeck
American novelist who wrote “The Grapes of Wrath”. (1939) A story of Dustbowl victims who travel to California to look for a better life.

public works
Government programs that provided people with employment by giving them work fixing and maintaining public facilities.

Reconstruction Finance Corporation
Agency established in 1932 to provide emergency relief to large businesses, insurance companies, and banks.

soup kitchen
A place where food is provided to the needy at little or no charge.

hunger march
Early in 1932, thousands of unemployed men demanding work protested at the Ford Auto plant near Detroit. Four were killed when police opened fire.

foreclosure
A legal procedure whereby property used as security for a debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the note.

installment
A payment plan that allows customers to make payments at set intervals over a period of time until the total debt is paid.

bailiffs
A minor officer of the court who ejected non-paying tenants.

hobos
The name given to those homeless and unemployed Americans who wandered around the country during the Great Depression walking, hitchhiking or riding on boxcars on freight trains.

William Faulkner
United States novelist who wrote about people in the southern United States (1897-1962).

soap operas
Serial dramas on television or radio using melodramatic situations. They were nicknamed this because they were often sponsored by makers of laundry soaps.

Grant Wood
American painter whose works focus on rural scenes in Iowa. Best known for “American Gothic”

Bonus Army
In 1934, facing the financial crisis of the Depression, World War I veterans tried to pressure Congress to pay them their retirement bonuses early. Congress considered a bill authorizing immediate assurance of $2.4 billion, but it was not approved. Angry veterans marched on Washington, D.C., and Hoover called in the army to get the veterans out of there.

Smoot-Hawley Tariff
A tariff passed in 1930 to help protect American companies. This charged high taxes for imports, thereby leading to less trade between America and foreign countries along with some economic retaliation.

List and explain the causes of the Great Depression.
1. People borrowed money and banks invested capital in a stock market that was wildly overvalued. When the market dropped, everybody sold their shares and the market crashed. People were ruined overnight.

2. Banks failed as people withdrew their money. Since the banks closed, there was less money in circulation for lending and economic growth. Business that relied on borrowing also failed.

3. People stopped spending money (or borrowing money to spend) on all types of goods and services, which caused unemployment to skyrocket.

4. Drought conditions in the Great Plains and the Mississippi Valley made it impossible for farmers to grow crops they could sell for money to pay their taxes and their debts. Many people lost their land when they had to sell.

5. The Smoot-Hawley Tariff, passed in 1930, raised taxes on imports. While this was a measure that was meant to protect American business from competition, it resulted in retaliation and a collapse in exports, which further increased unemployment.

How did President Herbert Hoover respond to the Great Depression? What was the effect of his response?
Hoover was cautious in his efforts to improve the economy. He also tried to present an optimistic outlook of the country’s economic situations. Voters responded to worsening unemployment by not re-electing Republicans to office. He asked for laws to fund banks and provide relief, but these efforts came too late. People started to protest the government and its ability to assist people.

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We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy Herbert Hoover – Republican candidate who assumed the presidency in March 1929 promising the American people prosperity and attempted …

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We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy Election of 1928 Alfred E. Smith (D) vs. Herbert Hoover (R), Smith was a Catholic, Republicans took credit for …

We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy What industrial weakness signaled a declining economy in the1920s? The older industries such as textiles, steel, and railroads, which …

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