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The Great Depression began with the crash of the stock market in 1929. (true or false)
false
The Great Depression was caused by too many Americans buying consumer goods using…
credit
What caused farmers to lose their land in the 1920s?
mechanized farm equipment was expensive and put farmers in debt
overproduction decreased prices on agricultural products
According to John Green, __________ is what made the Great Depression the Great Depression.
massive unemployment
If there was a single cause of the Great Depression, John Green says it was…
a weak banking system
When credit freezes, there isn't as much money in the economy and it leads to ________.
deflation
Who was president when the stock market crashed and the Great Depression began?
Herbert Hoover
What did the United States do that hurt world trade?
passed a high tariff
Why was Herbert Hoover criticized during the Great Depression?
He did not do enough to help the country.
What did Hoover do in early 1932?
He passed an Act to "bailout" the banks.
What were shanty towns of the homeless called?
Hoovervilles
Whose responsibility did FDR believe it was to guarantee that every man can make a decent living?
US government
What government agency insures peoples' deposits against bank failures?
FDIC
What program gave money to unemployed people who were desperate and needed money?
NRA
What did Roosevelt do when the Supreme Court started getting in the way of his programs?
He threatened to add new justices to the court
The Wagner Act guaranteed workers the right to join
labor unions
Unions argued that economic security meant that workers could…
buy more
Social Security is funded through what?
payroll tax
Which political party grew in membership and popularity during the 1930s?
democrats
What finally ended the Great Depression?
Massive government spending during World War II
How did the Great Depression/New Deal change Americans' expectations about the government's role in times of economic crisis?
People thought the government should get more involved in helping ordinary people.
________ at first approached the depression from a ________ viewpoint and was reluctant to directly offer assistance to the needy.
President Hoover; conservative
In contrast, _______ campaigned under the platform of a _________, promising to take charge of the economy in a more direct way.
Franklin D. Roosevelt; New Deal
What was President Roosevelt’s goal in his First Hundred Days?
To pass many new relief bills in the hopes that at least a few of them would be helpful
As manufacturers made popular products, the stock market grew into a ______.
bull market
People _______ money to invest in stocks and _______ grew.
Borrowed; speculation
When the stock plunged on __________, it became clear that the market was actually a ________.
Black Tuesday; bear market
People panicked about losing their money and withdrew it from banks, but these ________ caused the banks to run out of money and close.
banks runs
Why did many Americans invest in the stock market? Where did they get the money to invest?
Americans invested in the stock market using their savings and borrowed money in hopes of making profits from a successful company.
How did borrowing money to invest in the stock market affect Americans?
The people who borrowed money to invest ended up going into debt when prices dropped since they couldn’t pay their loans back, leading to their personal property being sold to pay their debts.
What happened on Black Tuesday?
On Black Tuesday, October 29, 1929, stock prices decreased leading fearful investors to sell their stocks. This panic led to prices decreasing even further.
How did the stock market crash lead to the banking crisis?
1920s: banks loaned money for stockbrokers rather than just farmers and businesses.
When the stock market crashed, investors couldn’t pay this money back to their brokers so banks were considered unsafe places to keep your money.
How were farmers affected by overproduction?
Although the demand for farm products decreased, farm output increased due to new machinery and farming techniques.
How were companies affected by overproduction?
Companies were producing too many products but consumers weren’t buying them so they ended up losing money.
How were industrial workers affected by overproduction?
industrial workers of the time saw a rise in wages but not enough to be able to purchase products at the fast rate they were being made
Instead: used credit to buy the appliances that were being mass-produced
How were farmers affected by underproduction?
Farmers saw a peak in consumption during WW1 -- provided food for soldiers fighting in Europe
After the war, consumption decreased leading prices to drop and farmers made less money.
Farmers didn’t have enough money to buy industry goods so they borrowed money -- weren’t able to pay their loans back → farms being seized by the bank
How were companies affected by underproduction?
Auto and steel production declined by 38% by 1930 causing some companies to shut down and declare bankruptcy.
How were industrial workers affected by underproduction?
As companies and industries began to fail, workers were fired meaning they didn’t make enough money to consume leading to underconsumption and unemployment.
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