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THE GREATDEPRESSION

1929

Photos by photographer Dorothea Lange

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THE NATIONS SICK

ECONOMY

AgricultureRailroadsTextilesSteelMiningLumber AutomobilesHousingConsumer goods

As the 1920s advanced, serious problemsthreatened the economy while

Important industries struggled, including:

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FARMERS STRUGGLE

No industry suffered asmuch as agriculture

During World War IEuropean demand for American crops soaredAfter the war demand

plummetedF armers increasedproduction sendingprices further downward

Photo by Dorothea Lange

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CONSUMER SPENDINGDOWN

By the late 1920s,

American consumerswere buying lessRising prices, stagnantwages and overbuying oncredit were to blameMost people did not havethe money to buy thefood of goods factoriesproduced

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THE STOCK MARKETBy 1929, many Americanswere invested in the StockMarket

The Stock Market hadbecome the most visiblesymbol of a prosperousAmerican economyThe Dow Jones IndustrialAverage was the barometer of the Stock Markets worthThe Dow is a measurebased on the price of 30

large firms

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STOCK PRICES RISE

THROUGH THE 1920sThrough most of the1920s, stock prices

rose steadilyThe Dow reached ahigh in 1929 of 381points (300 pointshigher than 1924)By 1929, 4 millionAmericans ownedstocks

New York Stock Exchange

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SEEDS O F TROUBLEBy the late 1920s,problems with theeconomy emergedSpeculation: Too manyAmericans were engagedin speculation buyingstocks & bonds hoping for a quick profitM argin: Americans were

buying on margin paying a small percentageof a stocks price as adown payment andborrowing the rest

The Stock Markets bubble wasabout to break

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THE 1929 CRASHIn September the Stock Markethad some unusual up & downmovementsOn October 24, the market tooka plunge . . .the worst was yet tocomeOn October 29, now known asBlack Tuesday , the bottom fell

out16.4 million shares were soldthat day prices plummetedPeople who had bought onmargin (credit) were stuck withhuge debts

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By mid-November, investors

had lost about $30 billion

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THE GREAT DEPRESSIONThe Stock Market crashsignaled the beginning of the Great DepressionThe Great Depression isgenerally defined as theperiod from 1929 1940in which the economyplummeted andunemploymentskyrocketedThe crash alone did notcause the GreatDepression, but ithastened its arrival

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CAUSES O F THE GREAT

DEPRESSIONTariffs & war debtpolicies

U.S. demand low ,despite factoriesproducing moreF arm sector

crisisEasy creditUnequaldistribution of income

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EFF ECTS O F DEPRESSIONSuicide rate rose morethan 30% between 1928-1932Alcoholism rose sharply inurban areasThree times as manypeople were admitted tostate mental hospitals asin normal timesMany people showed greatkindness to strangersAdditionally, many peopledeveloped habits of

savings & thriftiness

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Outbreak of World War IIcauses US factories flooded with

orders form armaments andmunitions

Unemployment decreases

and production increase Depression ends completely

by the time the US entersthe war in 1941

End to Depression