HIST 112 1st Edition Lecture 23The Crash of 1929Outline of Last Lecture I. Video on the CrashOutline of Current LectureI. Lead up to the crashCurrent LectureKey Terms: Herbert Hoover - Was concerned about the economy - Some people thought he was a “do nothing” presidentWarren G. Harding - Follows Wilson- Republican- Promised America a return to normalcy- Wins by a landslide- Clear domestic goals- Rolls back expansion of government powero Rolls back taxeso Raises the tarifo Believes they are good for businesso Economy seems to be doing wello His administration is going to be plagued by scandalThe “Ohio Gang”- Harding’s old allies - Gets them prominent positions in government- They are corrupt- Using their positions to make money- Harding expected their behavior, wanted to reward themThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.Death - 1923- Harding has a heart attackCalvin Coolidge- VP of Harding - Takes presidency - Also Republican- “Silent Cal”o Weird in Washington- Economy begins to do wellElection of 1924- Coolidge wins- Andrew Mellono Secretary of the Treasuryo Worked to reduce taxes, limit federal expenditures & retire part of national debto Small government o Farmers are still struggling1926- Farm relief- Would ask government to help subsidize farmers- Bill was vetoed- Coolidge doesn’t think the federal government should do this- Coolidge → “You better get religion”- Doesn’t believe the constitution says you shouldn’t do this - Disagrees with Progressives- Economy seems to be getting better- Investing savings in the stock marketFederal Reserve- Lower interest rates- Makes credit readily available- Money supply increased by 60%- Infrastructure increases- Roads all across the country1927 - Henry Ford - Sells millions of carsStock market - Soaring - Value increase 500%Progressive swell- Wanted change post WWIAmericans- Thought poverty was endingStock market- Many people investing- Don’t care what the companies are- Making it look like a good investment - Rich meno Buying bad stocks which tricked the average American“Buying on margin”- Buying stocks on credit- Creating a massive problem for Wall Street- Companies are being messed with1929- Falling 1929- October 24, 1929 → Thursdayo Initial plummet- Next Monday o Market loses 13% of value- Tuesday o Loses 12%Americans - Losing all of their moneySummer of 1930- Clear that the economy has serious problems- Recessions were “normal”- But this was a depressionDeflation- Opposite of inflation - Prices fall- Quite a serious problem- Supply goes down- Less incentive to buy- Fewer people being employed- Wages are dropping- Need to have more money in circulationAmerican politicians- Not afraid of deflation - Afraid of inflation- Washingtono Tightening the money supplyFederal Reserve Bonds - Takes money out of circulation- Wrong thing to do- Needed to loosen the money supply- Decreased by 4%1928- Herbert Hoover o Very popular mano Wins presidencyo Didn’t get along with Coolidgeo Activisto Response is too limitedo Opted for volunteerismHawley-Smoot Tarif- 1930 - Hoover signed it- US is headed for a serious recession - Thought it would protect business by protecting economy- 1,028 economists said don’t sign this- Ford said don’t sign it - Buy American made goods- Disastrous for the economy- Retaliation by Europe1931- This is no ordinary recession- Unemployment -> 16% 1932- Unemployment -> 24%Hoovervilles- Shantytowns - Thousands of unemployed AmericansFranklin Roosevelt- “Only fear was fear
View Full Document
Unlocking...