Summary
        The Great Depression had numerous causes and majority of them were rooted in the 1920's. After World War I many Americans turned to a more individualistic type of life style. Americans started to spend their money frivolously on new inventions such as cars instead of being frugal with their earnings. By Americans buying consumer products at such a high rate economy stayed strong, but there was one problem. The gap between the rich and the poor was widening. Rich people just kept getting richer. Business owners kept getting more money, but the worker's salary remained the same. Bussiness revenue went up to 65 percent, while worker's wages only went up eight percent. The governemnt did not help the situation either when they passed the Revenue Act in 1926. This act states that Anyone making a million dollars or plus gets a one third tax reduction.
          Another problem with Americans was they had a new invention called credit. Americans bought beyond their means and didnt think about how they would pay it off later. Americans were into the whole get rich quick motto and thats why many non wealthy people invested into the stock market. In the 1920's the shares started to increase in price and even cost more than what they were worth. Many people bought the inflated shares because they thought the prices would keep getting higher. When the stock market collapsed, it was a huge blow to the rich and poor alike.

Analysis
         The causes of the Great Depression are extensive and its a product of a series of unfortunate events. The American population is much to blame for the collapse of the economy. It was the people who just kept spending and spending without any thought. They began to pile up so much debt on themselves that the economy feeling the blow was inevitable. People just wanted to get rich, which doesnt really change with any decade, but in the 1920's everyone's need for wealth and consumer products is what sent the country and millions of Americans toppling down.

Citation

Kelly (2012, May 20). The great depression . Retrieved from http://www.brucekelly.com/library/great-depression.html

Reflection Question
How did Americans play a role in causeing the depression?

Summary
         Herbert Hoover was the president at the initiation of the great depression. Hoover believed that if workers had high wages and were able to share their jobs in place of being laid of then the economy would improve because they would be able to buy goods and services to provide wealth to the country. Hoovers ideas of having workers combine jobs and keep up high wages for them were Hoover's pro-labor cause. Hoover was a big cause of the great depression with his labor ideas. hoover consulted with numerous industry leaders to talk to them about increasing or stabilizing workers incomes, or have workers share their jobs in order tot keep the unemployment rate down. Hoovers plan caused the inflation of the wages to constantly grow at a time when deflation struck. The company owners did not have the money to pay the workers increasing wages. Since the companies could not pay the workers, they started to lay off workers and cut their week hours.

Reflection
         Herbert Hoover had the right intentions when he went to the companies. He caused bigger problems than just deflation though. Because of him, companies did not have the money to pay the workers their high fees, so they got laid off any ways. productivity in the country was low, so the companies just didn't have the money to pay the workers anymore. Hoover's pro-labor policies caused about two-thirds drop in America's gross domestic product. Without hoover The Great Depression may never of even happen, t could of just stopped at a recession.

Citation
Sullivan (2009, August 28). Hoover's pro-labor helped cause great depression, ucla economist says . Retrieved from http://newsroom.ucla.edu/portal/ucla/pandering-to-labor-caused-great-91447.aspx


Question
Do you think the Hoovers policies made America's economic crises worse?

Summary
       Before the crash of the stock market, unemployment rates already started to heighten. When more people are out of work, it means tehre is a smaller demand for consumer products. As the demand fell, deflation rose. Banks were panicing and the world monetary system crashed which caused panic in many Americans. The Great Depression was a series of unfortunate events. Workers were not being hired because there was no market for the products. There was no market for the products because the workers would not be hired so they didn't have money to spend on the products.

Analysis
       Basically everything that could of went wrong in a juncture of time did and that is what caused the depression. It was basically a circle that kept going round and round. Workers were out of work and couldn't find jobs because nobody was hiring due to the already overproduction of goods. The workers were the ones buying the goods, but they were out of work and couldn't afford good anymore, thus pushing the economy furthur into the brinks of depression.

Citation
       

Bradford DeLong. (1997, February). Slouching towards utopia?: The economic history of the twentieth century. Retrieved from http://econ161.berkeley.edu/TCEH/Slouch_Crash14.html

Question

Do you think the Great Depression was inevitable?

Summary The crash of the stock market occurred in a time of fun and laughter. Many people were not prepared to deal with the situation America's economy was facing. There was a lot of exces speculation on Wall Street. Wall Street had become a miniature economy of its own. Men sad that stock prices had reached their high and would remain there. They could not have been anymore wrong because on Wednesday October 23, 1929 stocks started to decrease and the first wave if panic had begun. The very next day brokers began withdrawing margin accounts, which caused stock prices to plummet. In a mere ten hours ten billion dollars worth of invested stocks were wiped clean. Luckily the market rebounded, but not for long. On Tuesday October 29, 1929 the market crashed. Sixteen million shares were traded on the day of the crash. The market lost a tota of fourteen billio dollars. Millionaires had become pennyless in a matter of hours. Analysis Many people were so wrapped up in the exillerating life style of the roaring twenties that they didn't really want to see the trouble America's economy was facing. Majority of the people simply ignored the warning signs. Months before the crash unemployment rates started to increase. Also, automobile prices began decreasing along with department store revenue. Whenever the market took a hit there was always salvation, but on October 29, 1929 nobody could save the stock market from collapsing. Many people said that the economy would not complete, recover until a decade and a half post crash. Citation Markets alliance (Producer) (2009). The great depression 1929-documentary [Web]. Retrieved from http://m.youtube.com/watch?v=nyAZGqFtVjw Question Do you think the stock market crash could of bee prevented if it occurred in a different time period?

Summary
  Farmers in the early 1900's did not properly manage their farmlands. In 1930 the Dust Bowl began and lasted until 1936. The Dust Bowl was a result of years of poorly managed crop productions in the Midwestern United States. When the stock market crashed, it is known as Black Thursday. The Dust Bowl also had a date like that. One day the wind speeds got up to 60 mph on April 14, 1935, and that was when the Dust Bowl was truly called the Dust Bowl. April 14, 1935 is know as Black Sunday. The Dust Bowl coincided with one of the worst economic crisis in American history, which made it that much worse. Over a million acres of land were harmed during the 1930's. Numerous farmers lost their land and jobs, so they migrated towards the city in hopes of finding employment. Urban life was not doing any better than rural and millions were unemployed in the cities. The migration of farmers towards the cities just increased unemployment rates in the cities and created  bigger problems.

Analysis
   The crash of the stock market definitely started the depression, but many factors went into the worsening of the situation. Millions of people in cities were facing unemployment already, so when the Dust Bowl occured millions of farmers then lost their jobs. At that point, America was looking at high unemployment rates in cities, lack of productive land, mass migration of farmers seeking work, and a failing economy.

Citation
Croft communications,Inc. (2012). The dust bowl andi its role in the great depression. Retrieved from http://www.thegreatdepressioncauses.com/dust-bowl.html


Question
Do you think the Dust Bowl furthered America into the Great Depression?

Summary In 1930 the senate passed a law called Smoot-Hawley Act. This act led to the increase of taxes on over 20,000 imported goods. Some say that act was a major cause of the depression. Another cause was the bank failures prior to the crash of the stock market in 1929. During the 1930's banks started to sell their assets in a panic. By late 1930 608 banks had failed. One of those failing banks was the Bank of the United States. That failure of fhat bank in particular had detrimental effects os the economy because when I failed the bank lost 1/3 of all deposits. By January 1932 1,860 bankes had failed. Analysis Most people believe the crash of the stock market was the sole cause of the Great Depression. In fact, it may not have been the crash that truly sunk America into the depression. Another thought was the copious amount of bank failures. The 1930's served as a devastating time for Americans duel all the bank failures. By 1932 1,860 banks had failed leaving people penniless. Citation Ferguson. (2008, October 2). The end of prosperity?. Time Magazine , Retrieved from http://www.time.com/time/magazine/article/0,9171,1846792, Question Do you think the bank failures played a big role in the Great Depression?

The Dust Bowl

Sumary
       The Dust Bowl was characterized by wind erosion, severee drought, and economic crisis on the Central and Southern Great Plain. The Dust Bowl occured in the 1930's. It started in 1933 and prevailed until 1940. The farmers were not directly affected by the stock market crash in 1929, but their immunity could only last so long. During the 1920's farmers went into a recession. Farmers were growing too many crops that the population did not demand. Prices of the crops just kept plummeteing and in 1930 the prices fell into oblivion. Since the price of crops fell so low and sand blew over the cropland, farmers were unable to produce enough money to support themselves. Many farmer's land was foreclosed. In 1935 46.6 million acres of crops were gone. A problem was arising for small bussiness men as well, becasue the prices of fertilizer, tractors, and automobiles lowered in the 1930's.

Analysis
      The crash of the stock market affected millions of people living in urban areas. Many people don't even realize farmers were going through a depression of their own. The rercession in the 1920's and the overproduction of crops was just the first part of the problems rural life faced. The Dust Bowl wiped out most of the fertile land, which caused farmers to be unable to produce any more crops. The Dust Bowl did not just affect farmers, but small merchnats as well. Prices for farm equiptment lowered in the 1930's, causeing merchants to lose money.

Citation
       Cunfer, Geoff. "The Dust Bowl". EH.Net Encyclopedia, edited by Robert Whaples. August 18, 2004. http://eh.net/encyclopedia/article/Cunfer.DustBowl

Question
         Do you think the Dust Bowl and the economic strife for farmers hada big contribution to America's Great Depression as a whole?

Website Information

         For the last couple of weeks I have been compiling all of my reasearc and information on a blog. Recently though, I created a website to take the information on my blog to the next level. The website takes all the information gathered and uses it in a new and technologically advanced way. The website enables people to view all the research that has been done in an interesting and informative manner. The website shows the my essential question, a basic history of the depression, and how the depression affected American's lives. This website can be found at https://sites.google.com/site/gettoknowthegreatdepression/home. The website includes a picture slideshow to give a visual representation of the depression, an audio recording, and a video. This website is truly a wonderful tool in portraying the research that has been done in a professional way. Hopefully the website will keep being a help in the research process and eventually unravel the causes of the Great Depression.

         Summary of Initial Findings 

   The Great Depression is a topic covered in every American history class. Many people only know the basic concept of the event though, such as the date the stock market crashed and that millions of people lost their jobs. The research thus far has looked at what caused the depression on a deeper level. To fully understand the depression one must understand the beginning of it all and how life in America changed so drastically in the blink of and eye. So far the research that has been done was more background knowledge and the history of the depression. The Great Depression has two main parts the infamous stock market crash and the Dust Bowl in the midwest. Both of those parts must be scrutinized to fully comprehend the Great Depression. Being a histroy buff, the journey through these past few weeks of research have been both rewarding and amusing. The real research has not even begun though, it will be exciting to see how much more there is to learn about events that led up to the depression.

Video

Summary
The speaker in the video states that the average unemplyment rate in America was one in four people. That was thirteen million people that were out of work in the duration of the depression. People were basically in shock at how bad America had gotten because it was in the jazz age and everything was running smoothly then all of a sudden disater struck. People in America lost sight of the "American dream" when the market crashed, putting the economy into the worst econimic times of the twentieth century. Things in America got even worse becasue of the dust bowl in the midwest. Many farmers lost their jobs and had to move to cities and set up slums basically. The depression did not end until America got involved in WWII because of all the military eqiptment that had to be made.

Analysis
The dust bowl did not cause the depression that was the crash of the stock market and many other factors within the banking system, but it did worsen the situation. Many farmers lost their jobs. When they lost their jobs , they no longer contributed to the economy, The more people out of work the worse the economy is going to get and that is exactly what happened. Many poeple were shell shocked when the crash occured because they were in an age of music, fun, and laughter. That could also be a reason times got so tough so quickly becasue no one was really in the mind set to deal with it. When America entered the second world war, equiptment was starting to be made in America which created jobs and in turn helped stir up wealth within the economy. WWII saved America from the depression in a way.

Question
Do you think it would of taken America a significant amount of time longer to get out of the depression if America did not get involved in WWII?

Citation
http://youtu.be/aPtbekTh2qo

Summary

                In this article there are two different explanations for the cause of The Great Depression. One of which is the monetary theory. This theory states that the problems within the banking system caused the depression. Banks did not have enough money in order to sustain the economy for Americans. In a state of panic people started to withdraw money from the banks which led to a lack of money in circulation. Monetarists were presumptuous when they believed that there was a high demand in investments during the 1930’s. In fact it could have been the other way around and there were not enough people that would put the money into investing, which in turn caused the depression. This theory does a very good job of describing the events that occurred that eventually led to the depression, but it does not give a valid explanation for the full duration of the depression. The other explanation is the demand theory. This theory takes a closer look at the spending patterns pre-depression. Basically, the demands for products lessened significantly which was the base cause of the Great Depression. Since the consumption of products was at a low in the 1920’s the demand for production was also at a low. As a result wages and employment rates plumeted which put the economy further into the depression. In the 1920’s the industries that were supporting the economy and enabling it to prosper were weakening prior to the market crash. The demand theory has explanations for all of the Great Depression, not just the beginning of it.

Analysis

                The two main theories about why the Great depression happened are the monetary theory and the demand theory. The monetary theory has some glitches in it because it really only covers reasons in the 1930’s of the depression. The theory covers the history of the depression quite well but it lacks support for the later years of it. The monetary theory zooms in on 1929 and 1930 with the crash and the banking problems but after that the theory is sort of vague and invalid. The other theory, the demand theory, does a much better job of covering the entire depression. It gives valid reasons as to why the economic state got so bad so quickly and kept spiraling out of control in a negative direction. Both theories have their flaws, but together they give a good idea as to why the economy hit an all time low from 1929-1941.

Question

In your opinion which theory is better? Why?

Citation

"Great Depression: Causes: What Caused the Great Depression?" History in Dispute. Ed. Robert J. Allison. Vol. 3: American Social and Political Movements, 1900-1945: Pursuit of Progress. Detroit: St. James Press, 2000. 54-61. Gale Virtual Reference Library. Web. 1 Mar. 2012.

 

The revolution in the Banking Theory

Summary

                During the time of the Great Depression, there were three major trends that could be seen within the banking system. One trend that led up to the depression were banks being unable to give people’s money back. In eight years, one sixth of banks in the United States were unable to give money back to the depositors. Another trend that could be seen within the banking system was the restriction of branching. Due to restrictions of branching within in the bank system, many banks started to chain together in corporations and partnerships. The last trend that could be seen was merging.  Banks started to merge which in turn led to weakness in the banking system. During the time period of the depression, the national bank was no longer capable of keeping up with the state banks. The state banks found loop holes with the prohibition of branching. New York for example continued to branch, but in city limits because of the scattered people living in the city. Since the people were in city limits, it did not alter the idea of a unit bank.

Analysis

                The article shows three main trends in the banking system that led up to the Great Depression. Banks were no longer able to give people their money, the restriction of branching, and banks merging. It is safe to say that many phenomenons occurred within the banking system in order to cause the depression. It is hard to believe that just one of these occurrences could of led to such a detrimental period in American history.

Question

Do you think that just one of the trends listed above could of caused the Great Depression?

 

Citation

Ostrolenk, B. (1930, February). The revolution in banking theory. The Atlantic , Retrieved from http://www.theatlantic.com/magazine/archive/1930/02/the-revolution-in-banking-theory/7111/

Summary/Analysis

Summary

                The Great depression was a time of struggle for Americans due to country-wide bank failures from 1929-1941. Many things within the banking system had happened that led up to the crash. The banking system grew too rapidly to control. There were more banks opening than the population demanded. From 1921-1930 many small banks opened in agricultural regions of America. The only reason so many small banks could open was because the money needed to open a bank during that time period decreased significantly. The results were unqualified people opening banks and too many banks opening at the same juncture in time. In 1929, 22 states stopped banks from branching. This was a punch to the face for banks, because it forced them to only stay in one geographic area for lending. This prohibited them from diversify, which made it hard to survive when the local economic status was at a low. Some say that contagion also had a factor in the crash, but others discredit the idea. Contagion in this text is referred to as, healthy banks failed due to trouble with more prominent banks. The reason why some people discredit the idea is because in the 1920’s contagion was not a factor in those bank failures, therefore there is no reason for it not playing a role in the 1920’s and then playing a role in the 1930’s.

Analysis

                There are many reasons why The Great Depression took place. Too many banks opened in unison for the population to support. People who were unqualified opened banks. In 1929 banks could no longer branch, which made it harder to stay afloat and function successfully. Contagion may have played a role, but many people are skeptical to say so because of the 1920’s crash. Contagion did not cause those crashes so; it is hard to believe that is caused the crash a decade later. It was not just one straight reason as to why the banking system flopped, but many reasons that can be further explored.

Reflection question

                Do you think that contagion played a role in the crash of the banking system?

Citation

Walter, John R. "Depression-Era Bank Failures: The Great Contagion or the Great ... "

QUARTERLY. ECONOMICWinter 2005: 39-54. SIRS Government Reporter. Web. 12 Feb 2012.

The Question

       I have always had a love for history. Throughout my time in the school system history class have hands down been my favorite subject. In eighth grade I took American history and that is when I knew I had found my passion. I have always enjoyed history because it amazes me what had to happen in the past for us to be here today. Keeping my love for Ameican history in mind, of course, I had to pick a topic in that. What better than the Great Depression since it does have basis in our current recession striken state.

What events led up to the Great Depression in American history?