Great Depression Flashcards
EXPORTS
dropped 50% between 1929 and 1931.
UNEMPLOYMENT BENEFITS
costs went up from £12m in 1928 to £125m by 1932.
UNEMPLOYMENT ROSE
from 1m in 1929 to 2 1/2m in 1930.
Moseley Memorandum –
May 1930.
What did the memorandum include?
Recommended a package of tariffs to reduce imports, government loans to set up public works, raise pensions to encourage early retirement.
What did Snowden do?
Rejected Moseley and cut spending to balance the budget.
What would balancing the budget do?
Install encouragement in the people.
What was this otherwise known as?
Retrenchment or deflation.
In 1931, the situation had gotten worse. What did RMD do?
He set up a 15-man think -tank, which included Keyes.
What did this think tank do?
Called for massive government spending to kick-start the economy - reflation.
What was RMD’s final decision?
To drift - to do nothing and hope for the best.
When did a decision have to be made?
By July, 1931.
What major problem had occured within British Banks (Think Gold Standard).
A ‘Run On The Pound’ had occurred; by July 1/3d of GB’s Gold Reserves had been used paying off foreign investors who withdrew their money from GB banks.
How did Snowden help?
He secured loans from New York banks to keep GB on the GS, but the banks insisted on spending cuts of 10%.
What were Snowden and RMD opposed to?
Coming off the GS.
