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The Great Depression Begins (1929–1932) - Coggle Diagram
The Great Depression Begins (1929–1932)
The Causes of the Great Depression
1.1 The Long Bull Market
economy began to collapse in 1929
1.1.1 The Election of 1928
Republican nomination: Herbert Hoover
Democratic nomination: Alfred E. Smith
Catholic
Catholics churches believe Catholic with rule US
damaged Smith's reputation
:star:Hoover won
1.1.2 The Stock Market Soars
stock market rose prices
:!!:bull market: long term rising of stock
:star:more people invested, some bought stock on margin
loaned from stockbrokers or banks
:!!:stockbrokers: protect loan, margin call: demand the investor to pay back the loan at once
:!:speculation: guessing when to sell the stock
:star:businesses: good sale-->higher stock earning fell--->fell in stock
1.2 The Great Crash
:star:bull market only last if more investors put more money in
latter half of 1929, prices began to fell
1.2.1 The Stock Market Crash
:star:October 21, 1929, stock market had plunged
customers sold all stocks and caused market tailspin
Black Thursday: market plummeted furthermore
Black Tuesday: steepest dive
:star:crash of the stock market: one of the cause of the depression
:star:crash of the stock market: prevent the economy from recovering
1.2.2 Banks Begin to Close
banks: loaned speculators money and invested in stock with deposits
banks closed: customers lost their money
:!!:bank run
depositors withdrawing their money at the same time feared the bank would closed
with money from the depositors--->banks closing
1.3 The Roots of the Great Depression
1.3.1 The Uneven Distribution of Income
:star:problem of overproduction
production increased
Americans can't afford that much
waste
:!!: installment plan
way to afford costy goods
pay a small amount of money at first
pay the remains with monthly installments
people stopped buying to pay debts--->cut production and aid off workers
:star:chain reaction: all industries related to each other collapsed because one of them was having problems
1.3.2 The Loss of Export Sales
weren't making sales overseas
1929, Hoover: wanted to encourage global trading
suggested to lower tariffs
other Republicans disagree: protect businesses from competition
:!!: Hawley-Smoot Tariff: HIGHEST tariff
fewer products were sold abroad
1.3.3 Mistakes by the Federal Reserve
:star:Federal Reserve Board lowered interested rates
encouraged people to loan more money for stock markets
businesses expanded the market suspecting the economy was still expanding
businesses borrowed money to expand--->overproduction
:star: the Great Depression finally hit
Life During the Depression
2.1 The Depression Worsens
depression grew worse
2.1.1 Struggling to Get By
people hungry: waiting up bread lines (private charities for food)
people got evicted form home
:!:court officials-bailiffs: evict people out
put on shacks on public land
:!: shantytowns: community of shacks on public land
calling the land "Hoovervilles"
:!: hobos: wanderers who sneak on freight trains
2.1.2 The Dust Bowl
price dropped ----->farmers leaving uncultivated land on the Greats plains
caused a drought
:!!:“Dust Bowl”: dust storms on the fields
dusts: buried crops and killed lives
some farmers moved west to California
remained homeless in CA
2.2 Art and Entertainment
1930s, Americans use arts and entertainments to escape from reality
2.2.1 Hollywood
child stars appeared
Walt Disney: brought Mikey Mouse
serious movies being optimistic
2.2.2 On the Air
radio dramas
:!: soap operas: shows' sponsors making soups--->nicknamed the shows
2.2.3 Literature and Art
:star:portrayed life of unemployed and homeless
Novelist John Steinbeck: evoked sympathy for character and indignation at social injustice
William Faulkner: writing technique to show characters thinking before speaking
Grant Wood: emphasized traditional values
Hoover Responds to the Depression
3.1 Promoting Recovery
Hoover's efforts failed to recover the economy
Hoover believed the economy will recover itself
Hoover organized conferences with head of industries
:star:tried to help with public works: government-financed building projects
Hoover refuse to increase gov. spending to create more jobs
kept taxes low
:!!: budget deficit---gov. spend more than taxes collect--->borrowing --->less money businesses can loan-->delay recovery??
3.1.1 Trying to Rescue the Banks
Hoover believed the gov. should help banks
banks loan money to corporations-->rehire workers and expansion
National Credit Corporation (NCC)
allowed banks to lend money
failed
Reconstruction Finance Corporation
allowed again the banks to make loans to businesses
failed again: increase its lending sufficiently
3.1.2 Direct Help for Citizens
:!!:relief: gov. give money directly to impoverished families
private charities can't help out --->more gov. relief
:star: Emergency Relief and Construction Act: gave relief to families
Emergency Relief and Construction Act: failed to reverse the situation
3.2 In an Angry Mood
3.2.1 Hunger Marches and Protests by Farmers
Hunger Marches: launched by American Communist Party
farmers
mortgaged and for the agriculture boost during WWI
price fell after WWI-->loss of money
:star:Creditors foreclosed farms-->leaving people homeless
3.2.2 The Bonus Marchers
after WWI, gov. gave bonus for veteran, DISTRIBUTED IN 1945
:star:1931, congressman Wright Patman, proposed a bill to release the bonus early
:star:veteran began marching for the passage of the legislation
known as the “Bonus Army”
:star:Senates voted down the bill
Hoover ordered to clear the building and leave the camps alone
:star:General Douglas MacArthur, ignored the orders and cleared the camps
:star:event damaged Hoover's reputation