Copy of History2057.ExamThreeNotes

Copy of History2057.ExamThreeNotes - 1930s I. Beginning of...

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1930s I. Beginning of the Great Depression > Hoover was an old-school guy but was good at bridging gap between old and new school > He liked the growth and industrialization > Hoover elected in 1928 and then market crashes > Causes - In 1924, durable good (consumer products, like appliances, to be used for a while) sales slowed - Mild recession begins in 1927 - Progressives had put in mechanism to deal with this – the Federal Reserve Board to lower interest rates, which they did ` Seemed to work for a while but a lot of other people took lower rates to borrow money and throw into stock market - In 1925-1928, value of market doubles - Market begins to have trouble sustaining this great value - Oct. 29, 1929, stock market went out of control and crashed - But stock market crash isn’t whole cause of depression; it trigger events in weakening economy - Several problems with economy in 20s that people don’t pick up on ` Two sectors – automobile and real estate – were saturated ` Thus, not enough people to buy them; supply greater than demand ` Second problem = banking ` Big banks were doing so well but then they go bankrupt and thus little banks go down ` People who actually saved money lost it ` Biggest problem = division in wealth causes inflation * Industry was more profitable than ever * Profits not evenly distributed * Most were blue-collar and didn’t have enough to consume all this new stuff * To keep economy going, consumption had to continue * Then, deflation ensues - Collapse is not immediate – it’s take some years to fully set in ` Initially, it looked like economy was leveling out and things would be okay ` But then declined again ` By 1933, gross national product (economy index) is cut in half ` Unemployment was about 25 percent ` Workers got less pay and fewer hours - To make things worse, drought hits on Great Plains ` Wind storms suck top soil away, and things can’t grow > Conditions - In 1920s, Americans starting priding themselves on being urban - Even artists painted American experience as urban settings - When depression hits, city conditions plummet - Unemployment was highest in cities with factories - In countryside, people were used to doing things for themselves so things were as bad - The middle class seems to suffer most during depression - Middle class are not familiar with the right way to struggle ` They don’t know how to go about by getting by with nothing ` They don’t know how to deal with it psychologically - Generally, the rich were hit by the depression but they tended to be okay - Middle class, most of them, lose everything - There was an interesting pattern in 1920s that emerged – number of hobos soars up ` Most hobos at this time wore fine suits and roamed around ` Most left their wife and kids because they couldn’t support them
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- Middle class is most affected by this – they were doing well in 20s but depression killed them II. Hoover Responds > Hoover sticks to his guns during this time > His principles were tailor-made for current political climate but Hoover’s problem was the emerging
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This note was uploaded on 04/12/2010 for the course HISTORY 2057 taught by Professor Outland during the Fall '09 term at LSU.

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Copy of History2057.ExamThreeNotes - 1930s I. Beginning of...

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