Jazz Age

What three things did economists say would help the economy in the 1920s under Warren G. Harding?

Lower taxes, increased tariffs, and reduced government spending.

Describe the trickle-down theory of economics

The trickle-down theory of economics posits that benefits provided to the wealthy and businesses will eventually "trickle down" to the rest of the population through investment and job creation, leading to overall economic growth.

What was agreed upon in the Kellogg-Briand Pact?

It was an agreement to outlaw war as a means of resolving conflicts between nations.

What were two new industries that started because of the affordability of cars in the 1920?

Tire company and roadside services.

What was ironic about Herbert Hoover’s campaign?

Herbert Hoover campaigned on the promise of prosperity and economic growth, yet he was president during the onset of the Great Depression, leading to widespread economic hardship.

Whats the difference between a bear and a bull market

A bear market is characterized by falling prices (typically a decline of 20% or more), while a bull market features rising prices (typically a rise of 20% or more).

What does It mean to buy a margin

Buying on margin means borrowing money from a broker to purchase stock, allowing investors to buy more shares than they could with their own capital alone.

What day did the stock market lose 80% of its total value?

The stock market lost 80% of its total value on October 29, 1929, a date historically referred to as Black Tuesday.

Give two reasons a stock market crash affected the banks

1. Banks faced significant losses due to devalued stocks they held as collateral. 2. Many borrowers defaulted on loans used to purchase stocks, leading to reduced bank capital and liquidity.

Explain the economic cycle in detail.

The economic cycle refers to the natural fluctuation of the economy between periods of growth (expansion) and contraction (recession). It consists of four main phases: 1. Expansion - characterized by increased economic activity, rising employment, and higher consumer spending. 2. Peak - the height of economic activity, where growth reaches its maximum, often leading to inflation. 3. Recession - a decline in economic activity, resulting in falling GDP, rising unemployment, and decreasing consumer spending. 4. Trough - the lowest point of the cycle, where the economy stabilizes before recovery begins.

What are thought to be the four causes of the Great Depression?

1. Stock market speculation and crash. 2. Bank failures leading to loss of savings. 3. Reduction in consumer spending and investment. 4. Drought and agricultural collapse.

Why wouldn’t Herbert Hoover help individuals during the Depression?

Herbert Hoover believed that direct federal intervention would undermine individual initiative and self-reliance, preferring to rely on state and local governments to address the economic issues.

What was Hoover’s approach to win in the 1932 election?

Hoover attempted to emphasize his administration's efforts to combat the Great Depression, promoting public works and other relief measures, while distancing himself from direct federal intervention.

What political office did FDR have before he ran for president?

Franklin D. Roosevelt served as the Governor of New York before running for president.

What was the plan called that FDR put together in Congress during the Depression?

The plan is known as the New Deal, which was aimed at providing relief, recovery, and reform to combat the effects of the Great Depression.

How did FDR communicate with the people of the US to let them know what was going on?

FDR communicated with the public through his 'Fireside Chats,' which were a series of radio addresses designed to inform and reassure Americans about government actions and policies during the Great Depression.

What was one complaint the Republicans had about the New Deal?

Republicans complained that the New Deal expanded the federal government's power and involvement in the economy excessively, undermining individual liberties and free market principles.

What was one complaint the Democrats had about the New Deal?

Some Democrats argued that the New Deal did not go far enough in providing relief and reform, advocating for more aggressive measures to address economic inequality.

Why was the Social Security Act passed?

The Social Security Act was passed to provide financial assistance to the elderly, unemployed, and disabled, aiming to alleviate poverty and provide a safety net for American citizens.

What did many farmers and Rangers do as a result of a dust bowl in the Great Plains?

Many farmers and Rangers migrated westward, seeking better living conditions and opportunities, while some also adopted new farming techniques to combat soil erosion.

What did scientists do to help farmers in a plain state after the Dust Bowl?

Scientists developed and promoted new agricultural techniques and crop varieties, such as drought-resistant plants and improved soil conservation methods, to help prevent soil erosion and restore fertility in the affected areas.