The great depression2

The Great Depression (1929-1939)

What was the Great Depression?
The Great Depression: a period of very low economic activity and high unemployment that spread throughout the world during the 1930s

Economic Boom in the United States
The Roaring 20’s
American factories produced most of the world’s manufactured goods
American workers made more money than workers in other countries
Banks in the U.S. loaned other countries large amounts of money

Economic Struggles in Europe
Most nations were deep in debt after World War I
Many countries printed too much money and experienced inflation (money loses value and prices go up)
Many European nations relied too much on the U.S. economy

Causes of the Great Depression
Too much confidence in the economy
Americans borrowed and spent too much
People made careless investments
Factories produced more goods than they could sell

The Stock Market Crash of 1929
The economy slowed down
Stock values began to fall
Investors panicked and too
many people wanted to sell
their stocks
Stockbrokers demanded
that borrowers pay off loans
People withdrew money from banks to pay off loans
Many banks did not have enough money and had to close
Prices dropped further
On October 29, 1929, Black Tuesday , values of stocks “crashed” to record lows

Effects of the Great Depression
Many banks and factories closed
People lost faith in the economy
People bought less and invested less
Many people became homeless
Unemployment was at an all time high
1/4 Americans and British jobless
2/5 Germans jobless

Different Responses to the Great Depression

The United States
Kept its democratic form of government
Voters gave government more power to deal with depression
The New Deal: set of programs started by President Franklin D. Roosevelt that helped bring the U.S. out of the Great Depression
The Social Security Act of 1935
Benefits for retired, disabled, and unemployed
Public building projects
Created new jobs
More government involvement in economy
Rules and regulations for businesses
Assistance for farmers
Higher taxes to pay for programs

Germany
After WWI, Germany set up a democratic government
New government failed to solve economic problems
Germans lost faith in democracy
During the Great Depression, Germans wanted a strong leader to help with their economic problems
Adolf Hitler: leader of the Nazi Party and dictator of Germany from 1933-1945
His ideas inspired German people who were suffering under the Great Depression and the Treaty of Versailles
Nazism: the political beliefs of the Nazi (National Socialist German Workers’) Party
Promised to build a more powerful Germany
Called for a powerful leader (dictator) to get things done quickly
Blamed Jewish people for Germany’s problems
His harsh rule brought Germany out of the depression

Great Britain
Kept its democratic form of government
Voters elected a new political party to help the economy
economic retrenchment: cutting back on
other government programs and focusing
on economic improvement
More government involvement in the economy
Raised tariffs to protect British businesses
Cut back money supply to limit inflation
Lowered interest rates on loans to encourage spending
Balanced the budget (got the government out of debt)
Raised taxes and controlled government spending
Cut military spending – saved money but weakened defense ability

The End
Special thanks to:
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Ben Bindewald

The great depression2

by 8th Grade - South Carolina History

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