Intro TO The Great Depression

Intro TO The Great Depression

Causes of the Great Depression

• Overproduction

• Dependence of Staples

• Canada’s Ties with America

• Tariffs and Trades

• Buying on Credit

• The Stock Market

Over Production

• Twenties were a time of new technologies> devices such as card and radios became popular so they started to over produce them

• This created a problem> too many goods and not enough buyers

• People didn’t need nor could they afford multiple luxuries so companies stopped creating them

• Problematic> companies cut down production so they down size staff which means less jobs = less money for people to buy

• Poor Fordism never had a chance~~

Dependence of Staples

• Wheat, fish, minerals, pulp and paper were important exports for Canadians

• Competition> Canada is the main supplier of wheat.

• Around this time, Australia and Argentina become suppliers.

• Because of the surplus (aka more product than demand) prices dropped

• Canadian farmers suddenly face a drought. Rich wheat feilds become known as the dust bowl.

• No crops mean no money.

Canada’s Ties with America

• 1920’s Canada bought 65% of imports from America.

• Sells 40% of exports to the United States

• This means Canada NEEDS the American economy to do well.

• America’s economy falls and ours does too.

Tariffs and Trades

• European countries were used to bying Canadian and American goods

• Canada attempts to implement “protective tariffs”> they can help foster the local economy but they can also make the item too expensive.

• Canadian businesses could not afford to buy goods from other countries because they were too expensive with tariff charges.

Buying on Credit

• People loved the idea of “buying now and paying later”

• The interest on their purchases came back to bite them. Interest was far greater than expected.

• People start getting laid off and can’t afford monthly payments> products are taken away.

• Many people lost everything they owned.

Stock market

• People were interested in the stock market.

• Stock Brokers would entice people to buy stock by lending them large amounts of money.

• A buyer could borrow up to 90% of their stock money and repay when the stock profited.

• Stocks didn’t always go up> October 29th 1929, value of most stocks on the Toronto and Montreal markets drop over 50%

Class Task

• Create a mind map of the six causes of the great depression.

• Work on your speak easy assignments.

• Homework: Find a photo from the Great Depression (doesn’t have to be Canadian). Give the people in the photo a story, don’t do any extra research, just think of what some of the obstacles might be during this time.

• Story should be at least 2 paragraphs