LET’S MAKE A DEAL
October 29, 1929, is more commonly referred to as ‘Black Tuesday.’ On this day, the United States stock market collapsed, leading to the sale of millions of shares of stock. In the ensuing months, various dominoes fell, resulting in banks, businesses, and other buildings closing and shutting down. One example rings clear. “A General Motors stock that sold for $91 before the Crash went for $30 the day after. By 1932 this stock would be selling for $7” (Schraff, 19). The entire country was too wary on keeping their stock; rather, everyone decided to take the easy way out and sell their stock before they drop even more. Herbert Hoover, the President at that time, was not able to quell the fear of the Americans and help those affected after the Crash. Luckily for America, Franklin Delano Roosevelt won the 1932 election. Immediately after arriving in office, President Roosevelt put his famed New Deals into effect. The two New Deals were highlighted by the Federal Deposit Insurance Corporation, an investment protection organization; the Civilian Conservation Corps, a public works organization that gave jobs to millions of people; the Federal Emergency Relief Administration, an act that helped governments and citizens, and many others. By going through Roosevelt’s ‘alphabet acts,’ people can see that whatever was possible was done in order to help the United States of America to regain her status as one of the world’s superpowers. Franklin Delano Roosevelt’s two New Deals helped the United States of America and its economy rise out of the Great Depression of the 1930s.
On Wednesday October 30, 1929, America woke up to a new life. “The day’s headline in The New York Times read: ‘Stock Prices Slump $14,000,000,000 in Nation-Wide Stampede to Unload; bankers to Support Market Today’” (Sherrow, 22). As most Americans lost money, businesses failed, and those that remained were forced to cut workers and drastically reduce the wages of those remaining. Between Black Tuesday and the end of 1932, the country was in a seemingly never-ending economic downturn. “Unemployment in those three years soared from 3.2 percent to 24.9 percent, leaving more than 15 million Americans out of work” (McElvaine). President Hoover severely wanted a change for the better. By reducing the country’s spending and raising the public’s taxes, Hoover hoped to stimulate growth and trust in the economy once more (McElvaine). To make matters even more complicated, Hoover had another ‘brilliant’ idea. He thought that reducing the amount of goods bought from other countries would help stimulate growth within the country. In this belief, Hoover raised the tariffs on imported foreign goods to the highest average level in American history (McElvaine). Hoover’s ideas failed for the most part and he would not be reelected in the 1932 election; rather, democrat Franklin D. Roosevelt won the election. Roosevelt saw the mess the economy was in, and immediately started working on fixing all the problems the country had.
When Roosevelt first entered office on March 4, 1933, he knew what he was going to do from the start. “On March 6, 1933, two days after becoming president, Roosevelt declared a five-day national bank holiday to close banks temporarily” (SparkNotes). This was merely to help the banks who had not yet closed to catch up and possibly be more stable after the short break. Roosevelt soon gained control of banking transactions and foreign matters, which allowed him to oversee the activity going on. Roosevelt also believed that keeping America’s investments intact would lead to more trust in the economy; FDR created the Federal Deposit Insurance Corporation, or the FDIC. This corporation was formed on the premise that all investments by the public would be protected up until the investment amounted to $5,000. Under the First New Deal, the American banking system improved drastically. Roosevelt did not...
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