Great Depression Section #3 Flashcards
New York Stock Exchange crash
- October 24th 1929
- collapse of investments and economic activity worldwide
Black Thursday
Sharp drop in share prices → withdrawal of investors → panic among buyers → millions of shares for sale and no one buying → market collapses and stock values become worthless → US economy collapse
Characteristics of the Crisis (4)
- 9,000 banks collapsed as everyone withdrew their savings
- Huge unemployment rates as companies failed because everyone was too broke to buy stuff
- Millions of citizens became homeless, starving etc.
- Farmers work failed as prices collapsed
The crisis spread to the rest of the world through
international trade and finance
World Trade (3)
Fell 2/3 of its value
Declined as countries became protectionist
US made the Smoot-Hawley Tariff Act which stopped a lot of international trade
New York Stock Exchange, the United States stopped….
giving other countries loans and investments and demanded money back, which many couldn’t pay back
Two groups that suffered the most during the Great Depression
exporters of raw materials and industrialized European countries
Raw Materials Exporting Countries….(4)
- Exported agricultural and mineral goods
- Prices of these products fell by 55% in 1933
- Eastern Europe, most of Latin America, Southeast Asia and China
- Debt grew and economies were ruined
Germany and Austria
- banking systems were heavily indebted to the outside world
- Banks closed in both counties and were struck with depression
United Kingdom (2)
- Lost credit from crash of Austrian banks
- Abandoned the gold standard
France
- The crisis was less and later
- Harmed by the UK abandoning the Gold standard
Unemployed Stats in 1932 (US, UK Germany)
12 million in United States
6 million in Germany
2 million in United Kingdom
Fear of communism spreading led to
- strong government repression
- extreme right-wing political groups
