Causes Of The Great Depression And New Deal

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Great Depression and New Deal • Great Depression: an economic crisis with low business activity that started from the US and spread on to other countries. o Causes: • The Stock Market Crash: Aon October 24, 1929, much selling of stocks caused the prices to go down a lot, and to fix this, bankers tried to buy millions of dollars worth of stocks. The following Monday people were selling their stocks, and on “Black Tuesday”, the 29th, everything just went down since there were no more buyers from the investors. • Causes of the Crash: o Overproduction & Under consumption: Companies would produce too much of their products, and thus they began to lower wages to keep up with their profits o Corporate Debt: Corporations would lie about their status just to get loans, which messed the banking system. o International Policies: The US increased its tariff on European countries, which caused them to stop buying US goods. • Conditions during the Depression: • Banks and business all around the US began to collapse. • Unemployment rate went from 3% in 1929 to above 20% by 1932. • Millions of families were homeless, which led to the set up of Hoovervilles. • There would be extremely long lines when soup kitchens served their free food. • Men would dress up fancily all day to search for jobs. o Some even abandoned their families because they couldn’t support them anymore. • Hoover’s Attempts to Fix the Depression: o Federal Farm Board: Made under the Agricultural Marketing Act, this board would offer farmers insurance if crops were damaged. o Reconstruction Finance Corporation: This agency was made to provide indirect relief by helping insurance companies, banks, agricultural organizations, and railroads. o Hawley-Smoot Tariff: This ... ... middle of paper ... ...ees and employers. • National Labor Relations (Wagner) Act: This created the National Labor Relations Board to reassert rights to unionize and bargain the representatives. • Fair Labor Standards Act: This made minimum wage and overtime pay. • Lend-Lease Act: This gave FDR the power to sell, transfer, exchange, or lend equipment to any country to help defend itself against the Axis powers. • Smith-Connally Act: This allowed the federal government to seize and take control over industries that were threatened by or under strike that would interfere with war production. • Neutrality Acts of 1935, 1936, & 1937: These acts stated that certain restrictions would be put into effect whenever there is a foreign war, such as having an American sail on a ship participating and that war, or giving loans to those fighting. This showed America’s isolationism and neutrality.
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