depression

Created by

Grace Leonard

Cards (127)

The price of houses had risen dramatically, especially in Florida
1926, housing market collapsed
Left people with huge mortgages for houses which weren't worth anywhere near that amount
They couldn't sell their houses to pay their debts, because they would still have a huge mortgage
Factories were making too many goods
Workers wages were too low to enable them to pay for more goods
Supply outstripped demand
There were too many cars made, and nobody to buy them
Factories had to make workers redundant
That meant fewer people could afford consumer goods
Farmers had produced too much
Prices fell and often were not enough to cover their costs
There were too many small banks
When people wanted to withdraw their money, they didn't have it
The banks had invested their savings in the stock market
Investing in shares became a hobby for middle class people
When the stock market collapsed, they lost lots of their money
In 1920s, America lent lots of money to Britain and Germany
When America fell into economic problems, they asked for their money back
This turned the Depression into a world crisis
Austrian bank Kreditanstalt collapsed
Led to world financial crisis
People lost confidence in banks
If a country had surplus goods they often tried to sell them abroad
America couldn't do this because after the Fordney-McCumber act, other countries put high taxes on American goods
This made them too expensive for people in other countries to buy
The Depression started in 1929, triggered by the Wall Street Crash
It lasted until 1939
The hardest years were 1929-32
1932, 13m people unemployed
2m travelled around looking for work, they became hobos
In Alabama, a third of white people and half of black people were unemployed
It was worse in the industrial northern states, as companies laid off workers
Those who had jobs, had their wages cut 25%
Ford had employed 120,000 workers in Detroit, fell to 37,000 by 1931
Industrial production fell by 45%
House building fell by 82%
By 1933, all the United States Steel Corporation's workers were working part time
100,000 companies closed
1932, a quarter of a million people lost their homes