Great Depression

What was the Wall Street Crash?

What was the Wall Street Crash?

The collapse of America's stock market in October 1929

Why did the Wall Street Crash happen?

People lost confidence that share prices would continue to rise so they started to panic sell which pushed prices so low that they became worthless and many banks, companies who owned shares lost fortunes

What was the Great Depression?

A recession caused by reduced numbers of people buying and investing which led to overproduction of goods, falling prices, forced businesses to close leading to high levels of unemployment and poverty

Would the Depression have happened anyway without the Wall Street Crash?

America was already heading into a Depression as there was an inability to sell goods (that were manufactured by over-production methods in the industry and agriculture) overseas due to tariffs. The Wall Street Crash only made the Depression happen more quickly and with far more consequences.

What is the connection between the Wall Street Crash and the Great Depression?

People started losing confidence in the price of shares when they saw the fall in sales, prices, and wages in industries so predicted the Depression was on the way anyway.

What were the overall causes of the Great Depression?

Overproduction, Overconfidence & speculation (which led to a panic selling of shares), Credit

how did overproduction cause the great depression?

The nation produced more goods than people could buy (as 42% were still below the poverty line) meaning the prices of items dropped, so companies had to reduce their workload and cut jobs

How did overconfidence and speculation cause the Great Depression?

Many American banks & the public had overspent and over-invested on an increasingly rising stock market, banks were loaning too much money, speculation increased the price of shares to a point where they were over-valued and not worth the amount people were paying

How did credit cause the Great Depression?

When a Depression was predicted speculators were worried that share prices would fall before they could pay off their debts so they sold their shares quickly which led to other investors becoming worried and copied.

What was the worst day for the stock market in the USA?

29th October 1929, 16 million shares were sold, $10,000 million was lost and the average value of shares was only 1/5 of waht they had been

What was the downward spiral of Depression?

After the crash banks called in loans and so people had less money to spend -> People didn't buy as many goods or services -> Prices had to drop to entice customers -> profits of companies also dropped -> companies had to reduce the hours and wages of their workers or cut jobs -> more people in poverty due to unemployment so had less money to spend

Overall Causes of the Depression Recap:

Poverty in America & foreign tariffs -> A drop in domestic and overseas customers -> overproduction -> loss of confidence and start of depression -> panic selling of shares by inexperienced speculators -> Wall Street Crash -> Sudden and dramatic depression

What were the consequences of the Great Depression in cities?

High unemployment (14 million - 25%), homelessness, Hoovervilles, self-help initiatives, dependency on charities, increase in suicide (23,000 comitted suicide), increase in crime, illness related to poor diet soar

What were the consequences of the Great Depression in the countryside?

Low prices & income (affecting mortgages/rent), overproduction & under consumption (farmers left crops to rot & killing their animals, hunger and disease increased (lack of food), crime (desperation due to lack of money/ hunger led to violence from usual law-abiding citizens)

What made the Great Depression worse?

Dust Bowl (1930-36)

What caused the dust bowl?

Over farming, drought, and high winds

What were the consequences of the dust bowl?

20 million hectares of land became dessert, crops couldn't be grown/animals couldn't survive, acres of land became a desert and caused farmers to migrate

What were the negatives of farmers migrating to California?

Locals put notices up telling them to go home as they were already suffering enough (they couldn't afford more people looking for work)

Who succeeded during the Great Depression?

Some farmers, individuals who took initiative to make money, the rich, Hollywood Film Industry

Who didn't benefit from the Depression?

Black Americans, Immigrants, Women, Elderly, some industries

Why did some farmers benefit from the Depression?

Grain growers on mechanised farms weren't affected by the Dust Bowl & fruit growers found their products to be in demand

Why did some individuals who used their initiative benefit from the depression?

Some used their initiative to make money by picking apples & selling them and cutting timber & trading it

Why did the rich benefit during the Depression?

Most wealthy people held their wealth over a variety of assets (gold, property, stocks, shares, savings) so although their fortunes shrunk they weren't ruined

Why did the Hollywood Industry benefit during the Depression?

Seats were only 25 cents so even those living in poverty or the unemployed visited 2 or 3 times a week. Throughout the Depression 60-100 million people went a week (half of the population of America)

why didn't Black Americans benefit during the Depression?

Black women lost their jobs, racism increased (40,000 unemployed white men joined the Black Shirts which was a campaign against black people in work)

Why didn't immigrants benefit during the Depression?

Immigrants lost their jobs to white people, many left America by choice or were deported (500,00 returned to Mexico in the 1930s)

Why didn't women benefit during the Depression?

Women lost their jobs as men were prioritised & double earning families were frowned upon, women in domestic services also lost their jobs as it was no longer affordable

Why didn't the elderly benefit from the Depression?

Many could no longer afford to retire (few American states had a pension scheme), older workers found it difficult to keep jobs so relied on families

Why didn't some industries benefit from the Depression?

All industries were affected by the Great Depression however businesses that sold luxury items fell by 92% as average spending fell by 17% between 1929 - 1933