22-1 The Nation's Sick Economy: Economic problems affecting industries, farmers, and consumers lead to the Great Depression.
pp. 642-649.
Essential Question: What caused the Great Depression?
Subquestions: ...don't shy away from including your opinion...just root it in fact!!
a. Which problems threatened the American economy in the late 1920s? Identify acute problems, both short- and long-term. (Acute means most severe, in this case.)
b. Which of the problems in a (mostly the section's green headings) is the most destructive?
c. How did Congress react to the economic slide? Were their (Congress's) actions logical or illogical?
d. What happened to ordinary workers during the Great Depression?
e. What were the ramifications (effects) of the Depression worldwide?
Opinion questions:
a. Which graph(s) are most helpful to you in understanding the economic troubles of the 1920s? Include title and page number in your response.
b. Would better information help the average citizen contribute more effectively to the economy's health? Or is that too unlikely in a capitalist system (profit-oriented)?
c. Are government price supports wrong?
d. Judging from the events described in this section, how important is consumer confidence to the health of the economy?
What caused the Great Depression?
ReplyDeleteThe Great Depression began in 1929 and ended around 1941. The first thing that signaled the Great Depression was the stock market crashing. Millions of people became unemployed. The caused of the depression came from many factors. "An Old and decaying industrial base-outmoded equipment, 2.A crisis in the farm sector-farmers produced more than they were able to sell. 3. The availability of easy credit-many people went into debt. 4. An unequal distribution of income- there was too little money in the hands of working people." ( Danzer-647) . "Farmers, already deeply in debt, saw farm prices plummet in the late 1920s and their implicit real interest rates on loans skyrocket; their land was already over-mortgaged and crop prices were too low to allow them to pay off what they owed." http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression.
People were shocked to see that the country had gone into an economic spiral downward. Hoover tried to keep the faces of the americans happy and confident. Even though Hoover tried to make the best of the situation it still didn't take away from what the reality really was.
http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression
What happened to ordinary workers during the Great Depression?
ReplyDeleteOrdinary people suffered greatly in the Great Depression. Farmers crops went down a great amout, as shown on the graph on page 643 titled U.S. Wheat Production and Wheat Prices. When the war started, Farmer's were in need and planted more crops and took out loans to buy land, but as the demand for farm product droped, crop prices droped by 50% or more (p.643) The average American had no money to spend. They started to buy less becuase of rising prices, stagnant wages, unbalanced distribution of income, and too much credit (an arrangement in which consumers agreed to buy now and pay later for purchases) (p.644)I found a picture that shows the percent of people jobless in the peak of the Great Depresson and till the end of it. More Civilain private nonfarm labor forces were jobless then compaired to Civilian labor forces. in 1932 it reached almost 35% unemployment. http://www.evetahmincioglu.com/web/blog/2008/10/10/the-great-depression-and-the-working-stiff/
Half of the nation's families earned less than $1,500 per year.(p.644) That was conisdered the minmul wage of the time. The wealthist (5%) of American families had 1/3 of the income, the poorest (40%) of the popluation earned 1/10 of the national income. Over all, as you see with these statistics, the average American, family and workers, all got hit pretty hard with the depression.
What were the ramifications of the Great Depression worldwide?
ReplyDeleteThe United States wasn't the only country to suffer. Many countries in Europe were trying to rebuild after World War One and faced high debt payments. Germany had to pay war reparations to defeated nations for the damage they caused. There was also a restriction on America's ability to import European goods. In 1930 the Hawley-Smoot Tariff Act was created and it established the highest protective tariff. It was designed to help farmers protect their goods and it did the exact opposite. The tariff made unemployment worse and hurt companies that could no longer import goods. People wanted to raise their own tariffs and soon world trade had fallen 40% which reduced economic activity overall. Problems worsened with the damages of World War 1 left over creating issues with gold currency. There were many debts that needed to be faced and Hoover proposed a moratorium or postponement of payments on Allied war debts. Britain along with other countries went off the gold standard which meant Europeans would be buying goods in cheaper currency. So many people were devastated by the Great Depression and it would only get worse as they tried to adjust to new ways of living.
Page 649 Danzer
http://www.youtube.com/watch?v=hbEVeKIghCk&feature=related
Here is a video clip of a people describing what it was like for their families to live in the Great Depression.
Which problems threatened the American economy in the late 1920s? Identify acute problems, both short- and long-term.
ReplyDeleteThere were many problems that threatened the American economy so I am going to concentrate on one of the them. A significant problem that led to the downfall of the American economy was that the industries were in trouble. Companies that produced products like textiles and steel were in trouble. Also railroad companies were competing with the new inventions that sprung into the nation like the truck and the private automobile. " Between 1925 and 1929, applications for new building permits declined by 25%." (Danzer, 643) Here is a link to a picture that shows another problem that led to the economic problems in America-being jobless.
http://zempower.com/wp-content/uploads/2011/02/2_great_depression.jpg
e. What were the ramifications (effects) of the Depression worldwide?
ReplyDeleteIn elementary and middle school, we always learned about what the Great Depression did to America. I never even thought about the worldwide effects. First of all, Europe faced high debt and war reparations from World War I. Now, America was limited in importing European goods. Congress passed the Hawley-Smoot Tariff Act in 1920 which reduced the flow of goods into the U.S. Danzer says "Congress made a bad situation worse" and I definitely agree. It was meant to help American farmers and manufacturers by protecting their products from foreign competition. It backfired and prevented countries from earning American currency to buy American exports. It made unemployment worse, and by the end of everything world trade had fallen more than 40%. European countries made it so their paper money could no longer be exchanged for gold, dropping its value. This meant Europeans would be buying American goods/repaying loans in cheaper currency. To me this seems like revenge, but justice because European countries faced unreasonable amounts of debt.
I looked up some worldwide effects of the Great Depression and found this website (http://www.buzzle.com/articles/effects-of-the-great-depression.html) which listed numerous outcomes, from creation of welfare systems to rise of power to militarist governments which had foreign policies that led to World War II.
What Caused The Great Depression?
ReplyDeleteThe Stock Market Crash of 1929 began this period known as the Great Depression (1929-1941). There is much speculation over what really caused it but there are four main reasons. First, the industrial base of the United States became old and outdated. Equipment became outdated, making some industries less competitive. Next, problems arose in the farming community. Farmers were growing more than they could sell, especially after WWI when the newly available markets were taken away. Also, credit was very easy to come by, and people went into debt because they bought everything on installment plans. Finally, the distribution of money was poor. The workers had little money, while the customers of an industry/company had a lot. That Stock Market Crash in 1929, could have been predicted by looking at the Down Jones Industrial Average, because it was the "most widely used barometer of the stock market's health." (Danzer 647) If it was looked at, the Great Depression could have been predicted and preventative measures could have been made. The link below shows a graph of the Dow Jones Industrial Average's around the time of the crash/Great Depression.
http://www.econreview.com/events/images/djia.png
Which problem was the most destructive?
ReplyDeleteThis is a question that doesn’t have a truly correct answer. All of the problems during the depression were largely detrimental to the country’s economy. However, if I was asked to pick out one single worst problem (which I am being asked right now) I would have to say that the “industries in trouble” was the most damaging. As Danzer described on page 642,”A number of key basic industries, such as textile and railroads, barley made a profit. When housing started to decline so did other businesses that relied on construction.” Having several of the main companies hit hard has a trickle down effect that negatively affects all companies below them. As is stated in this lengthy article (http://eh.net/encyclopedia/article/smiley.1920s.final) the “railroads had a hand in almost every major company of the time.” Besides hurting the companies, it also caused a rise in unemployment. When businesses stop making money they fire and lay people off, which raises unemployment. While all the other problems hurt the economy, none more so than the crash of huge corporations such as railroads, oil, textile, and housing.
SQe: What were the ramifications (effects) of the Depression worldwide?
ReplyDeleteLots of Bad Stuff (capitals for emphasis). It really wasn’t a good time for anyone. World trade went down 40% after the Depression (Danzer, p649). Also most of Europe went of the gold standard. This meant their money was no longer interchangeable with gold. Their currency also started being worth less so paying back debts was difficult (to say the least).
“One response to the depression was military dictatorship--a response that could be found in Argentina and in many countries in Central America. Western industrialized countries cut back sharply on the purchase of raw materials and other commodities. The price of coffee, cotton, rubber, tin, and other commodities dropped 40 percent. The collapse in raw material and agricultural commodity prices led to social unrest, resulting in the rise of military dictatorships that promised to maintain order.” http://www.digitalhistory.uh.edu/database/article_display.cfm?HHID=462