Great Depression

1. The Great DepressionThe Great Depression
1929-19401929-1940

2. Key TermsKey Terms
 ConsumerismConsumerism
 Buying on creditBuying on credit
 Republican Philosophy-Harding, Coolidge, HooverRepublican Philosophy-Harding, Coolidge, Hoover
 Laissez-faire, rugged individualism, trickle downLaissez-faire, rugged individualism, trickle down
theorytheory
 StockStock
 Stock marketStock market
 Dow Jones Industrial AverageDow Jones Industrial Average
 Buying on marginBuying on margin
 Watered stockWatered stock
 Stock poolingStock pooling
 Speculation-with stocksSpeculation-with stocks
 Income inequalityIncome inequality
 Federal Reserve BoardFederal Reserve Board

3. New York Stock ExchangeNew York Stock Exchange

6. Dow Jones 30Dow Jones 30

8. Milestones in Dow Jones HistoryMilestones in Dow Jones History

9. Federal Reserve SystemFederal Reserve System
 Created in 1913 under President WoodrowCreated in 1913 under President Woodrow
WilsonWilson
 Major goal was to stop banking panics(runs)Major goal was to stop banking panics(runs)
 Broke the country into 12 districts each with aBroke the country into 12 districts each with a
Federal Reserve BankFederal Reserve Bank

11. Federal Reserve’s PowersFederal Reserve’s Powers
 Banker’s Bank-stop bank runsBanker’s Bank-stop bank runs
 Controls the amount of money in circulationControls the amount of money in circulation
 Controlling inflation and deflationControlling inflation and deflation
 Controls interests rates for borrowing moneyControls interests rates for borrowing money
 Encourages people to borrow money for bigEncourages people to borrow money for big
purchases-homes, cars, etc.purchases-homes, cars, etc.

12. Income Inequality VideoIncome Inequality Video

15. Causes of the Stock MarketCauses of the Stock Market
Crash-1929Crash-1929
 Stock prices were grossly inflated, did notStock prices were grossly inflated, did not
have real value-watered stock priceshave real value-watered stock prices
 Overspeculation during the 1920’sOverspeculation during the 1920’s
 Led to watered stockLed to watered stock
 ““Buying on margin”Buying on margin”
 Led to people being in debt and watered stockLed to people being in debt and watered stock
pricesprices

16.  Overproduction of goodsOverproduction of goods
 Uneven distribution of wealthUneven distribution of wealth
 Too much borrowing from banksToo much borrowing from banks
 Federal Reserve increased interest ratesFederal Reserve increased interest rates
 Lack of government regulationLack of government regulation

18. Effects of the Stock Market CrashEffects of the Stock Market Crash
 Investors and businesses lose millions $$Investors and businesses lose millions $$
$$
 Thousands of banks fail-savings areThousands of banks fail-savings are
wiped outwiped out
 Businesses cut production-lay off workersBusinesses cut production-lay off workers
 Unemployment rises-people quit spendingUnemployment rises-people quit spending
moneymoney
 Great Depression sets inGreat Depression sets in
 Depression spreads to Europe and otherDepression spreads to Europe and other
parts of the worldparts of the world

19. Causes of the Great DepressionCauses of the Great Depression
 Overproduction of goodsOverproduction of goods
 Underconsumption of goods byUnderconsumption of goods by
consumersconsumers
 Agricultural slump due to overproductionAgricultural slump due to overproduction
 High protective tariff policies of the 1920’sHigh protective tariff policies of the 1920’s
 Taxes benefiting the rich-rich got richer,Taxes benefiting the rich-rich got richer,
poor got poorerpoor got poorer
 Stock market crashStock market crash

20. Effects of the Great DepressionEffects of the Great Depression
 New Deal programs start-makes the USNew Deal programs start-makes the US
gov’t much largergov’t much larger
 Deficit spending startsDeficit spending starts
 The New Deal creates many organizationsThe New Deal creates many organizations
that are still around today-social security,that are still around today-social security,
welfarewelfare
 Fascist, military and communist dictatorsFascist, military and communist dictators
come to power throughout the worldcome to power throughout the world

21. The Vicious Cycle of theThe Vicious Cycle of the
Great DepressionGreat Depression
 Companies lose $$ so they lay people offCompanies lose $$ so they lay people off
 Unemployment rate goes up and lessUnemployment rate goes up and less
people buy goods as income has droppedpeople buy goods as income has dropped
 Companies profits fall so they have to layCompanies profits fall so they have to lay
more people off or closemore people off or close
 Cycle repeats itselfCycle repeats itself

23. Herbert HooverHerbert Hoover

25. New York Stock ExchangeNew York Stock Exchange

28. John Pierpont(J.P.) MorganJohn Pierpont(J.P.) Morgan

29. John D. RockefellerJohn D. Rockefeller

30. Calvin CoolidgeCalvin Coolidge

34. Bonus Expeditionary ForceBonus Expeditionary Force

37. Macarthur and EisenhowerMacarthur and Eisenhower

38. BreadlinesBreadlines

40. Soup KitchensSoup Kitchens

41. Hoboes Hopping Freight TrainsHoboes Hopping Freight Trains

42. Selling ApplesSelling Apples

45. Dust BowlDust Bowl

53. OkiesOkies

55. Ch. 14.1Ch. 14.1
 The Nation’s Sick EconomyThe Nation’s Sick Economy

56. McNary-Haugen BillMcNary-Haugen Bill
 In early 1924, Senator Charles L. McNary ofIn early 1924, Senator Charles L. McNary of
Oregon and Representative Gilbert N. HaugenOregon and Representative Gilbert N. Haugen
of Iowa introduced a bill calling for the following:of Iowa introduced a bill calling for the following:
 ““A federal farm board was to be created to purchaseA federal farm board was to be created to purchase
surplus farm production at pre-World War I prices; thesurplus farm production at pre-World War I prices; the
surpluses were to be stored until domestic conditionssurpluses were to be stored until domestic conditions
improved or until a decision was made to offer themimproved or until a decision was made to offer them
on world markets.”on world markets.”

57. 1928 Presidential Election1928 Presidential Election
 Herbert Hoover(R)Herbert Hoover(R)
 Al Smith(D)Al Smith(D)

59. Hoover’s Ironic SpeechHoover’s Ironic Speech
 "We in America today are nearer to the"We in America today are nearer to the
final triumph over poverty than ever beforefinal triumph over poverty than ever before
in the history of this land... We shall soonin the history of this land... We shall soon
with the help of God be in sight of the daywith the help of God be in sight of the day
when poverty will be banished from thiswhen poverty will be banished from this
land."land."
 Herbert Hoover in his acceptance speechHerbert Hoover in his acceptance speech
June, 1928June, 1928

60. Dow JonesDow Jones
 TheThe Dow Jones Industrial AverageDow Jones Industrial Average
((DJIADJIA) is one of several stock market) is one of several stock market
indicators created by Charles Dow.indicators created by Charles Dow.
 Dow compiled the index as a way toDow compiled the index as a way to
gauge the performance of America's stockgauge the performance of America's stock
market.market.
 Today, the average consists of 30 of theToday, the average consists of 30 of the
largest and most widely held publiclargest and most widely held public
companies in the US.companies in the US.

61.  The Dow Jones Industrial Average consists of the following 30 companies:The Dow Jones Industrial Average consists of the following 30 companies:
 3M Co.3M Co. (MMM) (conglomerates)(MMM) (conglomerates)
 ALCOA Inc.ALCOA Inc. (AA) (aluminum)(AA) (aluminum)
 Altria Group, Inc.Altria Group, Inc. (MO) (tobacco, foods)(MO) (tobacco, foods)
 American International Group, Inc.American International Group, Inc. (AIG) (property & casualty insurance)(AIG) (property & casualty insurance)
 American Express Co.American Express Co. (AXP) (credit services)(AXP) (credit services)
 AT&T Inc.AT&T Inc. (T) (telecom services)(T) (telecom services)
 Boeing Co., TheBoeing Co., The (BA) (aerospace/defense)(BA) (aerospace/defense)
 Caterpillar, Inc.Caterpillar, Inc. (CAT) (farm & construction equipment)(CAT) (farm & construction equipment)
 Citigroup, Inc.Citigroup, Inc. (C) (money center banks)(C) (money center banks)
 Coca-Cola Co.Coca-Cola Co. (KO) (beverages)(KO) (beverages)
 E.I. du Pont de Nemours & Co.E.I. du Pont de Nemours & Co. (DD) (chemicals)(DD) (chemicals)
 Exxon Mobil Corp.Exxon Mobil Corp. (XOM) (major integrated oil & gas)(XOM) (major integrated oil & gas)
 General Electric Co.General Electric Co. (GE) (conglomerates)(GE) (conglomerates)
 General Motors Corp.General Motors Corp. (GM) (auto manufacturers)(GM) (auto manufacturers)
 Hewlett-Packard Co.Hewlett-Packard Co. (HPQ) (diversified computer systems)(HPQ) (diversified computer systems)
 Home Depot, Inc.Home Depot, Inc. (HD) (home improvement stores)(HD) (home improvement stores)
 Honeywell International, Inc.Honeywell International, Inc. (HON) (conglomerates)(HON) (conglomerates)
 Intel Corp. (INTC) (semiconductors)Intel Corp. (INTC) (semiconductors)
 International Business Machines Corp. (IBM) (diversified computer systems)International Business Machines Corp. (IBM) (diversified computer systems)
 JPMorgan Chase and Co. (JPM) (money center banks)JPMorgan Chase and Co. (JPM) (money center banks)
 Johnson & Johnson Inc. (JNJ) (drug manufacturers)Johnson & Johnson Inc. (JNJ) (drug manufacturers)
 McDonald's Corp. (MCD) (restaurants)McDonald's Corp. (MCD) (restaurants)
 Merck & Co., Inc. (MRK) (drug manufacturers)Merck & Co., Inc. (MRK) (drug manufacturers)
 Microsoft Corp. (MSFT) (application software)Microsoft Corp. (MSFT) (application software)
 Pfizer, Inc. (PFE) (drug manufacturers)Pfizer, Inc. (PFE) (drug manufacturers)
 Procter & Gamble Co. (PG) (consumer goods)Procter & Gamble Co. (PG) (consumer goods)
 United Technologies Corp. (UTX) (conglomerates)United Technologies Corp. (UTX) (conglomerates)
 Verizon Communications (VZ) (telecom services)Verizon Communications (VZ) (telecom services)
 Wal-Mart Stores, Inc. (WMT) (discount, variety stores)Wal-Mart Stores, Inc. (WMT) (discount, variety stores)

64. Black Tuesday Oct. 29, 1929Black Tuesday Oct. 29, 1929

67. New York Stock ExchangeNew York Stock Exchange

70. Ch. 14.3Ch. 14.3
 Hoover Struggles with the GreatHoover Struggles with the Great
DepressionDepression

71. Herbert HooverHerbert Hoover

72. Hoover’s Campaign PromiseHoover’s Campaign Promise
 ““A chicken in every pot and a car in everyA chicken in every pot and a car in every
garage.”garage.”

73. Boulder(Hoover) DamBoulder(Hoover) Dam
 Boulder Dam (renamed Hoover Dam afterBoulder Dam (renamed Hoover Dam after
President Hoover), located 34 miles fromPresident Hoover), located 34 miles from
Las Vegas, is one of the engineeringLas Vegas, is one of the engineering
marvels of the world.marvels of the world.
 Hoover Dam is 726 feet high and 660Hoover Dam is 726 feet high and 660
feet thick at its base.feet thick at its base.
 The Hoover Dam project including theThe Hoover Dam project including the
dam, the All-American Canal, the town ofdam, the All-American Canal, the town of
Boulder City, highways, railroads andBoulder City, highways, railroads and
various other works, cost $165 million tovarious other works, cost $165 million to
build.build.

80. Ch. 15 The New DealCh. 15 The New Deal
Section 1Section 1

81. 1932 Election1932 Election
 Herbert Hoover(R)Herbert Hoover(R)
 Franklin D.Franklin D.
Roosevelt(D)Roosevelt(D)

83. Relief, Reform and RecoveryRelief, Reform and Recovery
 Relief for the needyRelief for the needy
 Economic recoveryEconomic recovery
 Financial reformFinancial reform

84. FDR’s Brain TrustFDR’s Brain Trust
 -Harry Hopkins - Social Worker and the-Harry Hopkins - Social Worker and the
architect of much of the New Deal.architect of much of the New Deal.
 -Henry Morgenthau-Henry Morgenthau
 -Louis Lowe-Louis Lowe
 -Cordell Hull-Cordell Hull
 -Frances Perkins - Sec. of Labor and first-Frances Perkins - Sec. of Labor and first
female in the cabinet.female in the cabinet.
 -Sam Rosenman-Sam Rosenman
 -Raymond Moley-Raymond Moley
 -Rexford Tugwell-Rexford Tugwell

85. Fireside ChatsFireside Chats

86. Fireside Chat LinksFireside Chat Links
 rtsp://streaming.museum.tv/realvideo/mbc/rtsp://streaming.museum.tv/realvideo/mbc/
fdr.rmfdr.rm
 Fireside Chats of Franklin D. RooseveltFireside Chats of Franklin D. Roosevelt

87. Deficit Spending and Priming theDeficit Spending and Priming the
PumpPump

88. Court Packing BillCourt Packing Bill
 http://www.hpol.org/fdr/chat/chat.ramhttp://www.hpol.org/fdr/chat/chat.ram

90.  A. What were some of the reasons the NewA. What were some of the reasons the New
Deal was challenged?Deal was challenged?
 1. Created a very powerful president that led1. Created a very powerful president that led
Congress, this was a violation of checks andCongress, this was a violation of checks and
balances.balances.
 2. It was a radical departure from Laissez Faire2. It was a radical departure from Laissez Faire
ideals. Created "big government" .ideals. Created "big government" .
 3. Some acts appeared interfering and at worst3. Some acts appeared interfering and at worst
unconstitutional.unconstitutional.
 4. Heavy debt burden - the United States was4. Heavy debt burden - the United States was
engaged in deficit spending and this wasengaged in deficit spending and this was
unhealthy for the economy in the long run.unhealthy for the economy in the long run.

91. Father Charles CaughlinFather Charles Caughlin

92. Francis TownshendFrancis Townshend

93. Senator Huey LongSenator Huey Long

94. Share-Our-WealthShare-Our-Wealth
 http://www.authentichihttp://www.authentichi
story.com/audio/1930story.com/audio/1930
s/history/19341211_Hs/history/19341211_H
uey_Long-uey_Long-
Share_The_Wealth.mShare_The_Wealth.m
p3p3
 Shot and killed byShot and killed by
Carl Weiss in 1935Carl Weiss in 1935

95. Ch. 15.2Ch. 15.2
The Second New Deal Takes HoldThe Second New Deal Takes Hold

96. New Deal vs 2New Deal vs 2ndnd
New DealNew Deal
 Restore nation’s hopeRestore nation’s hope
 Help banks and stockHelp banks and stock
marketmarket
 Provide jobs andProvide jobs and
relief for poorrelief for poor
 Plan and regulate thePlan and regulate the
economyeconomy
 Pass new labor lawsPass new labor laws
 Create and expandCreate and expand
New Deal agenciesNew Deal agencies
 Establish SocialEstablish Social
Security for olderSecurity for older
people andpeople and
unemployedunemployed

97. Eleanor RooseveltEleanor Roosevelt

98. 1936 Election1936 Election
 FDR(D)-IncumbentFDR(D)-Incumbent  Al Landon(R)Al Landon(R)