The Nation’s Sick Economy

Section 22-1pp. 670-677

Preview Questions

• Why was the nation’s economy sick in the late 1920’s?

• What was Black Tuesday?

• How did the stock market crash affect businesses?

Trouble on the Horizon

• Farming – Overproduction Lower prices– Default on mortgages and lose land – Price supports vetoed

• Overproduction of Goods

Trouble on the Horizon

• Credit – Accumulated debt and couldn’t pay it

off

• Uneven Distribution of Income– People lack money to buy consumer

goods

Hoover Takes the Nation

• Hoover (R) elected in 1928

• Problems in Stock Market– Speculation – Buying on Margin – Inflated Stock Prices

Stock Market Crashes

• Black Tuesday– October 29, 1929– Sharp decline in

prices: “Crash” – $30 billion lost by

November

Financial Collapse

• Great Depression – Period of bad economic times 1929-

1940– Banks and businesses close – Spread worldwide

Financial Collapse

• Hawley-Smoot Tariff – Attempt to stimulate U.S. economy – Leads to decrease in foreign trade