Read full document


By | December 2012
Page 1 of 6
Ch.24: The Great Depression & the New Era & the New Deal -In 1933 after having the worse economic depression in US history, the American people were gripped by fear for their very survival. -depression of 1930s lasted longer and caused more business failures. -affected both middle and working classes.

-before it was over, Hoover & Roosevelt would devote 12yrs seeking the elusive path toward recovery. CAUSES AND EFFECTS OF THE DEPRESSION (1929-1933)
-business boom 1920s collapse in October of 1929.
Wall Street Clash:
-stock prices kept increasing for 18 mnths.
-The Dow James Industrial Average of major stocks reached an all time high of 381. -a investor who bought stocks at the time of Hoovers election would have doubled their money in less than a year. Black Thursday and Black Tuesday:-on Black Thursday there was an unprecedented volume of selling on Wall Street and stock prices plunged. -from October 29 and on, prices continued to decrease & by November, Dow Jones index fell from September high of 381 to 198.

Causes of the Crash:
-the depression was a result of a combination of factors that happened during the 1920s. Uneven distribution of income:
-economic success wasn’t shared by all.
Stock market speculation:
-ppl no longer invested their $ to share profits.
-speculating the price of a stock would go ^ & they could sell it for profit. -Buying on margin allowed ppl to borrow most of the cost of the stock. -when stock prices dropped, market collapsed & they lost everything they borrowed & invested. Excessive use of credit:

-advertising stimulated consumers’ desire for the exciting new appliances and cars that were being produced. Overproduction of consumer goods:
-Business growth produced a volume of goods that workers with stagnant wages could not continue to purchase. Weak farm economy:
-prosperity of 1920s never reached farmers who suffered from over production, high debts & low prices since the end of...

Rate this document

What do you think about the quality of this document?

Share this document

Let your classmates know about this document and more at