9 HIST1302 Chapter 8 Conclusion By the end of his term Hoover was at a loss

9 hist1302 chapter 8 conclusion by the end of his

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HIST1302---Chapter 8 Conclusion By the end of his term, Hoover was at a loss. Perhaps he was waiting for another Hoover to come along, the way he had at the end of the WWI. However, charities and the private sector produced no such white knights, and the scale of the problem far outstripped the capacity of charities to offer adequate resources. With people going hungry, and Ford workers singing “Internationale,” capitalism seemed on the brink – as close as it’s come to being fundamentally questioned in American history. One primary problem, it seemed, was the connection of cyclical markets and investment banks to commercial banks, where regular people kept their money instead of stashing it under the mattress where it could be stolen or burned. For some unlucky Americans, it was just as good as stolen or burned after they’d entrusted it to banks connected to the stock market. While slavery was the underlying cause of the Civil War, the immediate cause was secession. Likewise, the industrial slowdown, installment buying, Stock Market Crash, and trade protectionism (Smoot-Hawley) were underlying causes of America’s second-biggest crisis, the Depression. But its most immediate causes were the drying up of credit and subsequent bank failures. The Fed's unwillingness to inject cash into the system exacerbated the problem, as they were instead restricting cash supply to return to the gold standard. Similar problems were happening in other countries, especially Germany but also Brazil, Poland, Canada, Argentina and across Southeast Asia. In May 1931, a run on a major Austrian bank, the Creditanstalt , triggered panic across Europe and in England. In America, Andrew Mellon’s idea of letting things run their course wasn’t going to cut it, regardless of its actual merit (we don’t have proof, after all, that the economy wouldn’t have turned around just as quickly by doing nothing). Hoover tried some solutions, but it’s unclear whether they helped or just complicated things and, in any event, Congress blocked his major stimulus packages. By 1932, many people were in desperate straits and demanding a dramatic change in government strategy – starting with some food. Crash & Great Depression 1. Identify Andrew Mellon and the concept of laissez faire . How did Mellon influence economic policy in the 1920s? 2. Summarize some of the primary causes of the Stock Market Crash of 1929, according to our textbook. 3. Discuss the connection between the stock market and general economy. 4. Identify protectionism and evaluate the Smoot-Hawley Tariff. What motivated the tariff and how did it impact the economy? 5.Explain what Herbert Hoover tried to accomplish with the Reconstruction Finance Corporation. 6. Explain the causes behind the Dust Bowl. How did technology and nature intersect in an unfortunate way for Plains farmers? 7. Explain why people suffered more in the Depression of the 1930s than the unemployed do today. 10
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  • Fall '09
  • WILLOUGHBY
  • History, Great Depression, Wall Street Crash of 1929, President Hoover

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