The Stock Market Crash and the Great Depression, 1929-1933

Election of 1928
Alfred E. Smith (D) vs. Herbert Hoover (R), Smith was a Catholic, Republicans took credit for prosperity of 1920s => Republican victory in all but the south

Stock Market Crash
1929; didn’t cause the Great Depression

Wild Bull Market
1927; goes up very fast- it’s gonna come down sometime just because it goes up doesn’t mean the economy is good, price of stock doesn’t relate to how business is doing

buying on margin
get loan through broker from bank, when stock is sold you pay back loan. can lose money if business fails, risky but because stock market has been going up people are okay with buying margin

Joseph Kennedy
bootlegger for beer, acts like market is falling so everyone else does too

selling short
people loan to players, player sells those shares, buy it back for less after it goes through several people, makes profit, gives back to loaner

psychology
players make people believe market will go down and everyone tries to get out of the market

investment and consumer spending
need both for economy to grow

loss of confidence
consumers worry about economy- stop spending money (save up for disaster)

downward spiral of depression
banks have stock shares that are worth nothing, have no money because of loans for buying on margin, “run on banks,” they don’t have the money to give back to depositors, banks close, people lose their money, consumer spending goes down more
-1933 banking system is basically dead

impact of the depression
80% of the value of stock disappears, unemployment goes up to 25%-33%, starvation in large numbers, suicides increase, homeless-forclosures, divorce rates increase

hoover and the depression
seems not to care

committee of unemployment relief
1930; gives advice to charities on how to help unemployment

Smoot-Hawley Tariff
1930; high tariff that doesn’t work, causes US prices to go up- now we are less capable to buy stuff

European Economic Collapse
1931; our trading partners don’t want our goods, we have to lay people off

Reconstruction Finance Corp
1932; gov’t owned, given $500 million, give loans to businesses, with idea that it’ll open jobs

Bonus Expeditionary Force
1932; veterans march on Washington, offered big payment for 1945, want date moved sooner, most homeless, Hoover town outside DC, Hoover orders army to force vets out

Stock Market Crash (October 24, 1929) The speculative investments during the 1920’s led to “theoretical wealth” caused by: -Margin buying -Pumping and Dumping -Poor leadership during the 1920’s One major cause of the Great Depression Great Depression Two major causes: …

Stock Market Crash October, 1929. Signaled the start of the Great Depression. Black Tuesday Another name for the Stock Market crash in October, 1929. WE WILL WRITE A CUSTOM ESSAY SAMPLE ON ANY TOPIC SPECIFICALLY FOR YOU FOR ONLY $13.90/PAGE …

Stock Market -Companies sell a portion of their company -Investors make money off of the company -A particular market where stocks and bonds are traded; stock exchange. -A stock exchange is an organized system of buying and selling stocks in …

1929 What year was there a major stock market crash? There is a lot of economic uncertainty. Credit works well until what? WE WILL WRITE A CUSTOM ESSAY SAMPLE ON ANY TOPIC SPECIFICALLY FOR YOU FOR ONLY $13.90/PAGE Write my …

What were the signs of a weak economy 1. Old Industries (like coal and railroads) in decline but their stock price continued to rise (inflated stock values) 2. Agriculture prices were dropping due to overproduction 3. Worker buying power declined …

Laissez Faire the idea that the governmeny can not interfere in the economy Hoovervilles Durring the great depression people lost their homes because they could not afford themand people moved into these. These nieghborhoods were named after President Herbert Hooover …

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