Harding, Coolidge And Hoover Flashcards

Question

Media and advertisement 1920 boom

Answer 1

1929- over 25,000 cinemas opened + average of 100 million US wheat Movies became one of most important advertising mediums of 1920s 1920s- flapper —> wanted glamorous clothes Mass advertising - 70% of radios 1920s brought on credit Radios = +$1 million in advertising time to Democrat and Republican

Answer 2

Hire purchase - people bought goods even if X cash to pay for immediately End of 1920s a 4.5 million cars on road - largest industry in world 1913- Assembly lime 1918- ford factory - car every 3 min 1920- every 10 seconds People found work boring 1914 doubled wage $5 a day Workers raced to work for him Reduced working day to 7 hours Price decreased 1914= $850 1926= $295 90% petrol and rubber consumed by car industry Building of motels, highways and towns 1921 highway act - gov build roads. 10,000 miles 1 year

Answer 3

USA entered WW1 1917 No damage to repair - no war on US soil US made a lot of money by selling weapons and arms to France and Britain While European countries were busy fighting, USA took over many of their markets USA’s chemical industry replaced Germany industry as world leader producing explosives, fertilisers, dyes and plastics According to WW1/ foreign debts commission- Bri, France and Italy owed US $22 billion and interest

Answer 4

The USA was rich in raw materials such as steel and had much fertile land It was the world’s leading industrial nation It’s popular with migrants - hardworking and ambitious The early 1900s move from rural and agricultural to industrial

Answer 5

The total population of American industry increased 50% during 1910s The boom was fuelled by a demand for ‘new’ consumer goods For example radios etc Most significant was the growth in the motor industry

Answer 6

People could afford to buy new goods because income rose around 25% during 1920s - whilst prices remained the same or fell A reason for this was the introduction of the Assmebly Line - Ford —-> manufactured could increase production + make goods cheaper

Answer 7

Throughout 1920s, control of the economy were in the hands of Andrew Mellon He believed in laissez faire His policy was to give BB what it wanted. Businessmen believed of taxes were low, people and companies would have more money to invest The gov introduced high tariffs in foreign goods coming to America The Fordney-McCumber Tariff 1922- raised tariffs higher than ever before - protected US industry

Answer 8

The consumer boom was encouraged by the easy availability of credit Pioneered by car companies, hire purchase enabled customers to buy the goods they wanted with a small deposit, and then pay the rest in weekly, monthly instalments 6/10 cars bought this way Another marketing tool was the Mail Order Catalogue eg Roebuck Catalogue

Answer 9

The Republican government like businessmen - against trade unions Employers allowed to use violence to break strikes and refuse to employ union members Unions excluded altogether from car industry Employers able to keep wages low and working hours long - time when profits increase rapidly

Answer 10

Business corporations bought oil concessions in many countries like Canada Firestone corporation developed a rubber industry in Liberia Guggenhams invested in South America to produce nitrates, copper and lead United Fruit Co had large budget in Costa Rica US dominated Canadian markets and effectively destroyed their car industry US refused to trace or co-operate with USSR but American businessmen infiltrated the USSR. 133% of Ford Tractors went there) 1919- foreign investments in overseas: $700m 1930= $17200m

Answer 11

Breaking with laissez faire - The government investment a great deal in road building programmes 3 million miles of road in 1920 were largely unavailable to cars (1% available) Federal Highway Act 1921- led to 10,000 miles of road built by 1929 This had massive knock on effect

Answer 12

Farmers in South Carolina South Carolina Farmers Native Americans and African Americans Women

Answer 13

1929- farmers in South Carolina made $129 a month W in NY made $881 Fruit farmers in California - $1246

Answer 14

Overproduction - more produced than ever before - more than pop eat - causes prices to drop - lower income for farmers To keep incomes up - farmers grew more and cycle continued Farmers took our mortgages worth $200m during the 1920s Precipitation cut demand for grain Synthetic fibres mean no need natural Improved fertilisers, husbandry techniques lessened demand for workers Overproduction led to dustbowls and droughts

Answer 15

Native Americans often had difficult life on infertile reservations African Americans made up 10% of pop, but 85% lived in south, many as sharecroppers who lived in cycle of debt and poverty There was considerable migration north to search for far better opportunities to large cities - but here too, African Americans discrimination

Answer 16

By 1920 eg only 150 female dentists Women enjoyed more opportunities as clerical works and salespeople but overall got paid less than men Despite Jazz age of flappers, women were generally expected to concentrate on home and marriage

Answer 17

Uneven distribution of wealth Rural poverty Get rich quick Banking schemes Cycle of international debt Slow down

Answer 18

Income distribution Employment Old industries - coal and cotton —> unemployment Women —> unequal pay gap Nature and AA tend to be in agricultural work

Answer 19

Farmers economic problems Role of gov Agricultural business

Answer 20

Federal reserve board State banks

Answer 21

Loan repayments Dawes and young Plan US investment abroad

Answer 22

Small businesses for every 4 businesses, 3 failed Construction industry circula 1926 Failing domestic - demand saturated

Answer 23

Early 1920s Porru coined thousands into investing in his ventures He promised 50% profit return in 90 days Florida land boom - 1920-25- population increased from 0.8 million to 1.2 million Panels on land sold to wealthy northerners who had often not seen them People began to invest money into unseen developments, hoping to sell, make quick profit —> often people only put 10% deposit as binders Nature destroyed Florida Land Boom - hurricanes killed 400 on 1926 and Medeteraniun fruit fly dried up citrus industry People found out investments worth nothing or did not exists No recovery until WW2 when Florida became major military training centre

Answer 24

Very few prepared go learn from Florida land Boom and speculative investment on stock market continued Revisionist historian - only 1.5m people Large concerns were investing profits in the stock of others Eg Bethlehem Steel Corporation and Electric Bond and Share eavhcinvested $157m in market by late 1929 If prices fall- firms might go bankrupt

Answer 25

Banking system out of date in 1920s 12 regulatory reserve banks headed by federal reserve board System allowed banks to regulate themselves w/o gov interference The reserve banks represented the interests of the bankers and therefore could not be relied upon to act in interest of nation if - issue - While national banks had to join the centralised system, local state banks did not - In 1920s - almost 30,000 banks in US. - Most = v small -> unable to cope w financial problems - If collapses - depositors prob lose all savings Federal reserve board favoured low interest rates - encourage easy credit. Also wanted to see a flow of gold from USA to Europe so Europe can pay back loans

Answer 26

US priority = European nations repay loans - Europe still suffering from war - could not 1922- Congress created the Debt Funding Commission. Suggested deadlines set at 1947- interest at 4.25% Europe cannot accord Further agreement - 1923- harsh Get started to experience severe eco inflation in 1913 due to repetitions Under Dawes plan and young plan - USA lent money This resulted in USA taking money out of Treasury building and putting it in another Europe slowly started to recover as consequence But w repetitions - triangle of international debt Should anything happen to US eco :O

Answer 27

For every 4 businesses that succeeded, 3 failed. Gov not prepared to help Construction boom 1920s. But 1926- died down - decline in building materials and skills like plumbing - led to higher unemployment in construction - related business and had srs knock on effects Late 1920s production outstrips demand. More and more people in no position to spend in non essential items 1929- 10% Philadelphia labour force unemployed Estimate 1929/ 80% living close to subsistence Overall workers not protected by labour unions Supreme Court helpful - blocked child labour and minimum wages for women But many employers operated yellow dog clauses which their employees not allowed to join union

Answer 28

Share prices plummeting on NY stock exchange - SUDDEN Within an hour - 2.2 million shares sold

Answer 29

Market only gone up

Answer 30

People came in to trade stocks No buyers - price of shares fell 20,30 points at a time —> stunned

Answer 31

A financial catastrophe —> sweet | Away US catastrophe

Answer 32

Electrically, airplanes, radios, car industry —> luxury new necessity has

Answer 33

Credit —> buy now pay later Bonds —> borrow money from public to pay for war —> paid in interest —> Wall Street took advantage

Answer 34

President of national city bank Market eg corporate bonds and tell people they’re respectable investments

Answer 35

Telegraphic ticket rape machines —> share prices shown

Answer 36

Embraced all types of people into the stock market —> investment in private business !!

Answer 37

3 million on market —> it now pay later —> buying w borrowed money

Answer 38

Bull market - shares only go up Effects —> more demand for shares 1927- 50% - more borrowed People who did it - men from no where, celebrities, Wall Street, women

Answer 39

Republican - laissez faire

Answer 40

He issued a warning prior to depression but was disregarded

Answer 41

Market was volatile Hoover was unease’s

Answer 42

23 Oct 1929

Answer 43

24 Oct 1929 Beginning of crash

Answer 44

Mitchell - meeting at JP Morgan - made pool of $250 million to support key stocks Eg Rockefeller bought a big share WORKED

Answer 45

Panicking investors want to see prices - people see wrong of easy credit

Answer 46

Share prices plummeted 22% less than 28th October Hoover - it’ll solve self - laissez faire

Answer 47

$25 billion gone $5 billion in personal wealth gone Jobs lost Mortgages houses Victims Confidence sunk Suicide

Answer 48

Confidence sunk - banks failed

Answer 49

3000 banks closed next year ``` Spiral Loading money Prices fell Money dissapeared Companies let workers go Companies stop production Can’t get loans Bankrupt as cannot pay people off Laid them off ```

Answer 50

1929 3% unemployed | 1933- 25% unemployed

Answer 51

1929- 599 banks failed | 1933- 3927 banks failed

Answer 52

1920-$2.45 per bushel | 1924- 0.62 per bushel

Answer 53

Big agriculture Drought - dust bowls -erosion Repossessed Uneven distribution of wealth Mass poverty AA

Answer 54

Too little too late Hoovervilles Hoovenlags Voluntarism Bonus army

Answer 55

Structural unemployment federal reserve

Answer 56

Unemployment Rugged individualism Voluntarism relief Migration

Answer 57

Saturation Worthless Slowdown in demand

Answer 58

Agriculture Tariffs War debts Voluntarism Unemployment relied Home loan act RFC Jan 1932 War veterans and Bonus Army

Answer 59

Agriculture marketing act 1929 9 person board with £500m to create co-operatives AIM was to buy, store and dispose surplus No power to reduce production, prices therefore continued to fall Therefore buying at this rate was waste of money When congress proposed bill to reduce production, Hoover opposed it

Answer 60

Hawley smoot tariff 1920- highest 40% on agriculture and industry Most European nations abandoned free trade and therefore even fewer goods were exported Therefore farmers fought it and only passed by 2 votes Hoover could have vetoed but did not

Answer 61

Hoover blamed depression on Europe Trade fell after 1930 by $500 m $1.2 billion in 1931 1931- Hoover issues moratorium on debts but it was too late + most European countries collapsed

Answer 62

Hoover advocated voluntarism Business had to cut back Voluntarism could not work

Answer 63

$500m secures from Congress in 1932 to secure relief President Emergency Committee to help agencies organise But Hoover would not issue direct federal relief In the end $47m was made available and only as loans

Answer 64

1932 As loan - was only 50% of value property Ineffective

Answer 65

January 1932 Most radical measure Could lend up to £2b to rescue banks etc Designed to restore confidence 90% small and medium banks Argued that it only helped large firms but gov argued these needed help most No money given to individuals Eventually - July 1922 - $4.5 billion lent to public works, he lost support from reps

Answer 66

Hoover set up .org to help veterans with disabilities Congress agreed bonus in 1925 Hoover offered to pay their way home Many leafy squatting Army moved in and removed them Violent dispersal often seen as last act

Answer 67

Hoovers first response was mostly passive, trusting in the conservative approach to leave business to sort it out Later 1931-32 Hoover changed his mind and carried out a few interventionalist policies — too little too late

Answer 68

Set up organisation to help veterans with disabilities

Answer 69

RFC- Jan 1932- no money given to individuals July 1932- $4.5b lent to public works only Voluntarism no work 1931- Hoover issued movatorium (temp postpone of debt)but too late - European countries collapsed

Answer 70

Decline in agriculture Decline in staple industry Overproduction Uneven distribution of wealth Get rick quick Decline in trade (high tariffs) Cycle of international debt Native of Great bull market Loans Gov Psychology

Answer 71

Wall Street crash Car ownership boom ended 1929 before WSC Construction boom ended 1929/9 before WSC Industry production 1929 (2 months before WSC)b

Answer 72

Hoover Laissez faire Voluntarism Allowed deflation Mellon ‘plurge the rotten elements’ Banking crisis

Answer 73

1923 Fordney McCumber tariff - protectionism Isolationism Laissez faire Rugged individualism 1920 majority of tax payers paid 5% federal income tax - Mellon Plan

Answer 74

People bought on credit - luxury items- putting some money down 1st - followed by 1-5 year’s monthly payments Due to laissez faire Easy credit - inc in consumer indebtness - dramatic decline in savings 75% of pop spend most of yearly income to purchase foods inc food and radios Consumer credit 1929- outstanding £3 mill People gambled on stock market ‘safe bet’