Great Depression Flashcards
(24 cards)
What was the Great Depression?
The worst economic downturn in Modern History, marked by massive unemployment, bank failures, and global economic collapse.
What cultural and economic era preceded the Great Depression?
The roaring 20s - a time of jazz, consumerism, and stock market boom.
How did the Great Depression impact the world?
It spread globally, worsening the economic conditions and accelerated the outbreak of WW2.
How did WW1 influence women in the workforce?
WW1 saw women entering the workforce, post-war America experienced an economic boom as men returned.
What innovation did Henry Ford introduce?
The moving assembly line, enabling mass production of the Ford Model T.
How did Ford’s car change American Life?
It became the first inexpensive car for the masses, dropping in price from 780$ to 290$
What did Mass production lead to in the 1920s?
Consumer goods like fridges, radios, and vacuums became widely accessible as many copied Ford’s moving assembly line.
What role did advertising and banks play in the consumer boom?
Advertising boosted demand, banks loaned money more freely to fuel consumption.
What happened to the stock market from 1921 to 1929?
It increased by 6x due to post-war optimism and consumerism.
What risky behaviour did many citizens engage in during the stock market boom?
many invested life savings and took out loans to buy stocks, creating a dangerous bubble.
What was the economic situation globally in the mid 1920s?
Global demand dropped due to Europe’s post-WW1 struggled and stalled trade
How overextended was the US economy by 1929?
40% of consumer debt was used to buy stocks - a sign of extreme speculation.
What triggered the stock market crash in 1929?
On October 24th, mass liquidation led to an 11% drop, by October 29th, 16.4 million shares were sold.
Was the stock market crash the sole cause of the Great Depression?
No, it triggered a recession, but weak banking policies and unregulated loans deepened the crisis.
Why did Bank Runs occur after the crash?
Fear of losing savings led people to withdraw money. Banks couldn’t meet demands and collapsed.
What was the bank of the US incident?
A rumour led to panic and a massive withdrawal, with over 3 million dollars pulled and eventual closure.
What happened to the US money supply from 1929 to 1933?
It declined by 31% as people kept cash on them rather than in banks.
How did deflation worsen the depression?
It increased debt burden, discouraged spending/investment, and caused income/wage declines.
What was the Federal Reserve’s role during the Great Depression?
It failed to act, worsening deflation and the economic situation.
What was the Smoot-Hawley Tarrif Act?
Hoover’s policy to protest US industry, which backfired as other countries, (UK,Germany,Canada) imposed tarrifs too.
How did the Smoot-Hawley Tarrif affect global trade?
Global trade dropped by 66% as retaliation increased economic isolation.
How many US banks failed during the Great Depression?
Around 9,000 banks failed, wiping out 9 million savings accounts.
What was the peak unemployment rate during the Great Depression?
24.9%, the highest in US history.
What were Hoovervilles?
Makeshift shantytowns named after President Hoover as he was blamed for failing to address the crisis.
