EXAM REVISION 2020 Flashcards
What was the Wall Street Crash?
When the prices of the shares plummeted drastically after 16 million shares were sold
When was the Wall Street Crash?
October 29th 1929 BLACK TUESDAY
Who was involved with the Wall Street Crash?
20 million Speculators involved in buying shares on margin and then selling them in hopes of making a profit
How did the Wall Street Crash happen?
A massive panic set in which caused people to sell their shares as they began to realize that the prices of the shares were falling. There were more sellers than buyers
Where did WSC happen?
Wall Street, New York
Reasons for the WSC
Companies tried high pressure advertising $3 billion but with wages not rising and prices not falling demand decreased
Weaknesses were showing- car sales/ construction rates
Many groups relied on the stock market as speculator
Lack of confidence meant price of shares dropped
What were weaknesses of the US economy throughout the 1920s?
Overproduction Too many small banks Tariff War Overproduction of consumer goods therefore falling pricces and the market was saturated Decline in traditional industries coal mining textiles--> unemployment Unequal distribution of wealth Laissez faire Debt increasing- hire purchase International debt
What was the unequal distribution?
50% of American families had an income of less than $2000 a year
What happened on 19th october?
3,4 Million shares sold
What happened on 20th october?
Market closed down
What happened on 21st October?
6.1 million shares bought and sold
What happened on 22nd October?
Prices rose slightly
What happened on 23rd October?
2.6 million shares were sold
What happened on 24th October?
BLACK THURSDAY 12,9 million shares were traded- more sellers than buyers
What happened on 25th October?
Bankers met and decided to support the market- prices rose
What happened on 28th October?
Heavy selling- 9,1 million shares bought and sold
What happened on 29th October?
BLACK TUESDAY- 16.4 MILLION shares traded- MARKET HAD CRASHED
What were the problems of the US banking system?
Ordinary people would borrow money from banks lent from banks
Banks would use the deposited money to get involved in speculation
Small banks lended too much
Too many small banks so liquidity is smaller and the capital is smaller
small investors could not pay back money if prices fell so speculators wen bankrupt
banks lent up to 90% of the loan
How much did the banks lend speculators?
9 billion dollars
How much did the number of people owning shares increase by?
500%
How many banks were failing in the 1920s?
500 BANKS
How much money was lost from the stock market?
14 billion dollars
What was the financial effect of the Wall Street Crash?
Rich lost money but remained wealthy People went bankrupt Banks went bankrupt Run on banks Unemployment Farmers could not sell their products average farm production declined USA international trade fell Government spending fell
How many banks went bankrupt in 1929?
659
How many banks went bankrupt in 1931?
2294
How many banks went bankrupt in 1933?
5000
How many people were unemployed in the US?
14 million 25%
How many people were unemployed in Detroit?
50%
How much did farm wages drop by?
60%
How much did farm production drop by?
40%
How much did the USA’s international trade drop by?
10 billion to 3 billion
How much did the government spending drop by?
10 billion to 8.7 billion
What were the social impacts of the WSC?
farmers were homeless Hobos rode around looking for jobs crime rate increases suicide rate increased homeless people lived in hoovervilles soup kitchen were a bid support malnutrition abandonment of children rep. government blamed the problems on Europe Hoover failed to act quickly
What was the suicide rate in 1929?
18 per 100,000 people
How many people died from malnutrition in 1931?
45
What was the political impact of the WSC?
Strikes and demonstrations- support for communism
Bonus marches
Hoover was the DO nothing president
1932 elections won by FDR democratic
How many people were killed in the Bonus Marches?
2
How many soldiers were there in the Bonus Marcherrs?
15,000
