the great depression

2. what was it?
• “For most Americans, at most times in American history, the
economy has provided real opportunity for real individual
success.
But what would you do if the economy suddenly stopped
providing that opportunity? If it no longer seemed to matter how
hard you worked, how smart you were, how responsibly you took
care of your money? If the system just stopped working,
seemingly dooming you to a life of poverty through no fault of
your own?
Would you blame yourself?
Would you work harder, striving to prosper, against all odds,
within the failing system?
Or would you try to change the system itself? And if so, what
would you try to change it into?”1
1. Shmoop Editorial Team, "The Great Depression, "Shmoop University,
Inc., 11 November 2008, http://www.shmoop.com/great-depression/
(accessed November 28, 2010)

3. How Could This Happen?
By the test you will be able to answer:
• Why did the stock market crash?
• Why was the economy so bad for so long?
• How did it affect people?
• How did the government try to stop it?
• Did it work?
• What made the economy get better again?
• Could this happen again? Are we headed to
another Depression?

4. Could another depression
happen?
This is a video!
To view go to:
http://got.im/e3v

5. Unemployment now

6. Unemployment:

7. Stock market
• Stock: A small piece of a company that is
bought and sold
• Stock market: A place where stocks and
bonds are “traded” (bought and sold)
• Goal is to buy the stock, hold on to it for a
time, and sell it for more than you paid

8. Risks of the Market
• Stocks go up and down
Stock
price of
Apple this
year
iPad
announce
d
iPads
go on
sale
Holiday
shoppin
g
season
Short-term
investors
selling

9. September 1929:
Greatest Crash in history

10. Causes
1. Speculation: Buying stock with the plan
to sell it again quickly when the market
rises
2. Buying on margin: Borrowing money to
buy stocks
Example: I make a down payment of $5
for a $50 share, you promise to pay back
the rest when you sell the stock
 I can buy $1,000 worth of stock for
only $100. If stock crashes, I still owe

11. causes
3. Using too much credit: Booming
economy, advertising, easy loans and
installment plans made people borrow
more than they could pay back
4. Overproduction: Too much stuff to sell,
no one to buy it
5. Unequal distribution of wealth: Rich
people got richer but workers’ wages
didn’t rise, so they couldn’t buy the stuff
being made

12. causes
6. Government policies: No regulation of
the stock market
7. Problems in European economy
impacted the U.S.
8. Weak farm economy: production too
high, prices too low, debt too much

13. But most of all..
• Overconfidence: Investors felt like if they
bought stocks they couldn’t lose.
They were wrong.