Causes & Early Effects of the Great Depression

1. What happened on "Black Tuesday"?

On Black Tuesday, the bottom fell out of the market and the nation's confidence. Shareholders tried to sell stocks quickly before prices dropped even more, but couldn't find buyers. 16.4 million shares were dumped that day.

2. How did the economic trends of the 1920s in industry, agriculture, and with consumers help cause the Great Depression? (Make sure you include significant details about each area in your answer. It should be at least a paragraph)

The AGRICULTURE in the 1920's went way down from the times of the war. During the war wheat and other grain were in high demands, so farmers took out loans in order to expand their farms to meet the demand. When the war was over the demand went down, and farmers lost because they were in debt from taking out the laons, and they couldnt pay the loans back because they werent making enough money to. Because of this the farmers raised the prices of their gooods, which made the people have to pay more. Because of the credit that was now avaible people would creat debt for themselves. The INDUSTRY helped caused the great depression because the basic textiles (railroads,textiles, and steel.) Coal was hit hard after the war because there were new forms of electricty so people were no longer buying it. When housing fell so didnt the jobs that went with it such as construction, and industries that built things such as furniture, rugs etc.

3. According to your reading, what are the major causes of the Great Depression?

Some of the major causes of the Great Depression were the lack of demand for crops, livestock and coal mining, as well as the change of spending habits of Americans.

4. What was Hoover’s philosophy of government?

He believed that one of government's chief functions was to foster cooperation between competing groups and interests in society. He thought that this cooperation must be voluntary, and that the government should encourage and facilitate cooperation, not to control it.

5. What was Hoover’s initial reaction to the stock market crash of 1929?

Hoover initially issued a statement which aimed to assure people that everything was fine and to calm them. He hoped that it would prevent panic.

6. What was the nation’s economic situation in 1930?

Economic difficulties increased in 1930 and Americans grew more and more frustrated by the Depression.

7. How did voters in 1930 respond to this situation?

Democrats took advantage of anti-Hoover sentiments to win more seats in Congress, and because of this, Republicans lost control of the House of Representatives and saw their majority in the Senate dwindle to one vote.

8. What did Hoover do about the economic situation?

Hoover's plan was to encourage employers not to cut wages or lay off workers, and labor leaders not to demand higher wages or go on strike. He also created an organization to help private charities generate contributions for the poor.

9. How did the economy respond to his efforts?

The economy was unchanged by all of the efforts of Hoover except for the construction of Hoover Dam. It provided electricity and flood control, as well as providing a regular water supply, which enabled the growth of California's massive agricultural economy.