USA 3 economic crisis Flashcards
republican policies KU
Laissez-faire - businessmen make decisions on own
Jobs and better wages
Promoted American produced goods at expense of foreign imports
Fordney-McCumber 1922 led to strict tariffs
‘Protectionism’
republican policies A
Foreign countries set up tariff barriers against USA
Impossible for US to increase overseas exports
Falls in production
Increased unemployment
republican policies A+
Businesses no longer had to compete with foreign competitors
Increases their sales in the states
weaknesses of the US banking system KU
Rural areas, banks invested customers’ savings
Offered easy loaning terms which encouraged high levels of borrowing
This money was used to engage speculation on stock market
weaknesses of the US banking system A
Banks were small so not enough money to withstands major setbacks such as recession
To recall savings, banks had to declare themselves as bankrupt as they couldn’t recall speculators loans
weaknesses of the US banking system A+
Allowed businesses to start up
Increased competitiveness within companies
international economic problems KU
Sold weapons to involved countries
WS loaned 2.3b
Compared to others, US economy remained relatively unscathed
World leading economic power so brought goods
international economic problems A
Peter Clements “a victim of its own success”
Loan out money to Europe to rebuild economy (especially germany)
Dawes and Young Plans - paid back allies TOV
US just paying itself
international economic problems A+
Countries buying american goods after the war
Gave profits and job opportunities
Canada and USA dominated both the car and electrical industries
overproduction and underconsumption of goods KU
Produce new goods as profits from countries
Electrical goods - radios, fridges, washing machines
160m sold per year
Ford Model T produced in this time
overproduction and underconsumption of goods A
Manufacturers started making too much
People couldn’t afford to buy latest model or a better adapted version
Once they had what they needed, no reason to buy more
Business closed and unemployment
overproduction and underconsumption of goods A+
Companies improved by employing workers at its factories (Ford)
Recruited employers to built roads, rubber and refine petrol
wall street crash KU
Financial experts warned
Selling shares in large numbers = nervous
Investors went into panic so sold stocks
24th October, 12.8m shares sold = Black Thursday
Stock market in NY collapse
wall street crash A
Companies cut back production or collapsed
Millions of jos, wages, prices, spending dripped
Wouldn’t buy goods
Banks took homes and possessions off those who has outstanding loans
wall street crash A+
