Oct. 29th 1929
Lasted until 1942
Investors paid 10% of stocks value at time of purchase.
People would buy and sell stocks quickly, to make quick money.
Stock prices rose from $130 to $396 per share.
Stock Speculation hurt company's because they needed long term investments.
Investors all tried to sell stocks at the same time and the bottom fell out of the market.
Economic Cycle- Purchase power went down with more unemployment and reduced productivity.
OverProduction- More goods then people to buy.
42% below poverty line.
most of other 58% fell into the middle class.
Voluntary Non - Coercive Cooperation where he gave tax breaks in return for private sector economic investment.
Hoover Moratorium - put a temporary stop to war debt & reparations payments.
Smoot Hawley-hoped to stimulate purchasing of U.S. goods. But Failed.
Other countries passed high tariffs and no foreign markets purchased American goods, so U.S. productivity decreased again.
1 out of 4 was unemployed
national income was 50% of what it had been in 1929
Winner: Franklin Delano Roosevelt
A revolution in America - changed completely the way the gov't functions
Banking Holiday- banks shut down and subject to government inspection, allowed to open when "healthy"- people's confidence returned.
Liberty League - The Supreme Court overturned the NIRA & NRA, claiming that federal government was exceeding its authority (by interfering in state jurisdiction).
Food Stamp Act of 1939 - gave away surplus food to poor
Civilian Conservation Corps - in 1933 - set to establish work for young men (18-25)
National Youth Admin. (NYA) - created jobs for young people in urban areas
Social Security Act (1935)- This act typifies the Welfare State - unemployment insurance, old age pensions.