Section 1 Flashcards
When did the stock market crash?
7 months after Herbert Hoovers inauguration in 1929.
What was the Great Depression?
The worst economic depression in the United States history.
Who didn’t share the prosperity of the 1920s?
Textile workers and coal miners.
Farmers face hard times. What kept farm prices low?
Overproduction.
In the mid-1920s, the economy began to slow down, but no one noticed because at that time the government did what?
They did not keep detailed statistics.
By August 1929, some investors worried that the boom might end, so what did they do?
They began to sell their stocks.
Many investors had bought stocks on…?
Margin.
With prices falling, brokers asked investors to what?
Pay what they owed.
What happened to those who could not pay what they owed?
They had to sell their stock to get money.
Panic set in as desperate investors tried to do what?
They tried to sell millions of shares.
What did this make stock prices do?
Fall even further.
When the stock market open on Tuesday, October 29, what took place?
A wild stampede of selling.
What happened on Black Tuesday?
Stock prices plunged and stocks that had been valuable were now suddenly worthless.
What was the period of economic hard times that followed the crash on Black Tuesday?
The Great Depression.
How long did the Great Depression last?
1929 to 1941.
The stock market crash did not cause the Great Depression, but what did it do?
It shook peoples confidence in the economy.
What were the two factors that caused the Great Depression?
Over production in farms and factories, and weakness in the banking system.
Farms and factories produced vast amounts of goods in the late 1920s, but what didn’t keep up?
Wages did not keep up with prices.
When wages couldn’t keep up with prices, what could workers not do?
Workers could not afford to buy many goods.
What happened as orders slowed?
Factories closed or laid off workers.
In the 1920s, what unwise things did the bank make?
Unwise loans.
What is an example of an unwise loan?
They lent money to people to buy stocks, and when the stock market crashed, borrowers could not repay the loans.
Without money from the loans, what happened?
Banks could not give depositors their money back if they asked for it.
Between 1929 and 1932, how many banks closed?
More than 5,000.
The stock market crash ruined many investors because without money from investors businesses couldn’t do what?
Grow and expand.
Why couldn’t businesses borrow from banks?
They were in trouble.
As factories cut back production, what two things did they do?
They cut wages and laid off workers.
Unemployed workers had little money to spend, so what demand fell further?
The demand for factory goods.
What happened to many businesses so even more people lost jobs?
They went bankrupt, or they weren’t able to pay their debts.
The Great Depression led to a worldwide economic crisis because American banks had what?
Loaned money worldwide.
What happened when American banks stopped making loans and demanded repayment of loans?
Banks in other countries began to fail.
In the 1930s, many Americans no longer lived on farms and lived where?
Millions lived in cities.
What did people do in cities?
They worked in factories.
What happened when factories closed in cities?
The jobless had no money for food and no land on which to grow it on.
What were four things that people did on city streets?
They sold apples and pencils, shined shoes, begged for money, and picked through garbage dumps.
What dropped?
Marriage and birthrates.
What did some families do?
They split up.
What did fathers and even children as young as 13 or 14 do?
They drifted from town to town looking for work.
What did some people do who were looking for work?
They “rode the rails” or lived in railroad cars.
Some people shared what they had. Some families did what?
They doubled up and took in relatives.
What feeling did jobless people suffer from?
The feeling that they had failed.
Who was concerned about the suffering and believed the government should not become directly involved in ending the crisis because it can become too powerful?
President Hoover.
Who did Hoover believe it was up to, to end the downside?
Businesses.
At first, what did Hoover oppose?
relief programs.
What were relief programs?
programs to help my needy.
Who did Hoover call on to provide jobs?
Business leaders.
What kind of private charities did Hoover make to help?
Churches set up soup kitchens where the hungry could get a free meal.
What did Hoover set up as conditions grew worse?
Public works.
What are public works?
Programs to provide jobs.
What are 3 examples of public works?
Schools, dams, and highways.
What corporation did Hoover ask congress to approve?
The Reconstruction Finance Corporation.
What did the Reconstruction finance Corporation do?
Loaned money to banks, railroads, and insurance companies.
What did Hoover hope that saving businesses would do?
Save jobs.
Hoover did more to reverse hard times than any previous president but what happened to his efforts?
They were too little and too late.
What did people blame the president for doing?
For doing too little.
What name did people give to the shacks of the homeless?
Hoovervilles.
Who took action to help themselves?
World War I veterans.
After the war, what did Congress vote to give veterans?
A bonus.
What was a bonus?
A sum of money on top of their wages.
In 1932, more than 20,000 jobless veterans marched where to demand what?
They marched to Washington to demand the bonus right away.
What where the jobless veterans who marched to Washington and who camped in tents along the Potomac River called?
The Bonus Army.
What happened after the Senate rejected a bill that called for paying the bonuses immediately?
Local police tried to force the veterans to leave.
How many people were killed when the Senate rejected the bill about the bonuses?
Four.
When the Bonus army moved into the camp, what did they do?
Burnt it to the ground.
What happened to Hoover after the attack on the Bonus Army?
Hoover lost all of what little public support he had left.
