Causes & Early Effects of the Great Depression

1. What happened on "Black Tuesday"?

"Stockbrokers were ordered to sell at whatever the price, and the stock market crashed."

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)

Many industrys that had previously been important and booming became no longer important due to the development of new technolegies. These industries could no longer make a profit. During WWI the demand for crops grew tremendously and with this being true many farmers began to grow a supless of crops. The demans dropped after the war, however, and farmers grey more that they could pay for and went into debt. As unemployment rose, inflation grew as well, and people stopped buying goods because of the raise in price.

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

a. dependency on credit
b. uneven distribution of income
c. failure of industries
d. failure of farmers
e. dangerous consumer habits

4. What was Hoover’s philosophy of government?

He believed the government's chief purpose was to settle disputer between competeing partys, but was also a strong supporter of individualism.

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

He said it was part of the natural economic cycle and that everybody should stay calm.

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

The depression was at an all time low.

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

Many incumbant republicans were voted out of office.

8. What did Hoover do about the economic situation?

At first he reflected his beliefs in small governmet intervention by only takeing minor measures , such as establishing the National Credit Corperation, which loaned money to smaller banks. Eventually, however, the public demanded a more activest approach by the federal government, and he the economy into the government's hands by signing into law the federal home loan bank act and establishing the reconstruction finance committie.

9. How did the economy respond to his efforts?

Buisness failures continued.