The Great Depression was caused by a combination of factors, including overspeculation in the stock market, the 1929 stock market crash, bank runs, widespread panic and loss of confidence, and natural disasters like the Dust Bowl drought and major flooding. This led to a sharp drop in demand, mass unemployment reaching 1/3 of the nation, and many Americans losing their savings, homes, and farms.

1. What caused the Great
Depression of the
1930s?

2. Depression= a period in which an economy is
greatly affected by unemployment, low
production, and poverty.

3. 1. Overspeculation:
• People bought stocks on margins
– If a stock is $100 you can pay $10
now and the rest later when the
stock rose
• If Stocks fall
– Now the person has less than
$100 and no money to pay back
– Americans didn’t think about the
possible consequences of over
speculation making risky deals
for profits.
Causes of the Great Depression

4. Causes of the Great Depression
On October 29th, 1929 the Stock
market crashed—this is known
as “Black Tuesday”. American
stock holders lost a lot of money,
some who had invested all their
savings in the stock market lost
all and were now homeless and
people who bought stocks on
credit were stuck with huge
depts.
2. Stock Market Crash 1929:

5. After the crash many
Americans panicked
and withdrew their
savings from banks.
This led banks to run
out of cash to give
back.
Causes of the Great Depression
3. Bank Runs:

6. Americans couldn’t afford
to buy luxuries and those who
could were only able to buy the
essentials to survive.
1/3 of the Nation
Becomes
Unemployed!
Causes of the Great Depression
4. Panic:
• This leads to a drop in demand
• business cut production
• Workers are laid off
• Less Americans are able to buy goods.
• Business to go bankrupt
• Even more workers are laid off

7. To make matters worse…
Americans experienced two major
natural disasters during the Great
Depression
5. The Dust Bowl—(a.k.a. Black Blizzards)
In the 1930s a severe drought gripped the
Midwest or Great Plains region. Strong
winds picked up and scattered the top soil.
More than a million acres of farmland were
declared useless and thousands of farmers
lost their jobs and houses.
6. The Great Floods—In the Northeast, a
series of heavy storms combined with heavy
melting snow caused rivers to spill over.
Flood waters inundated cities, farms, and
mines. (385 people died and 1 million were left homeless.)

8. The Dust Bowl
“Black Blizzards”
The Great Floods

10. Dust storm approaching Stratford, Texas - 1934

11. Storm approaching Elkhart,
Kansas in 1937

12. Dust buried cars and wagons in South Dakota
in 1936

16. •In your opinion, which
cause of the Great
Depression would you
consider to be the most
devastating for Americans
living during the 1930s?