Chapter 14 American History Study Guide
What were Hoovervilles? Hoover blankets? Hoover flags?
-Hoovervilles are a shanty town built during the Great Depression by the homeless in the United States of America. They were named after Herbert Hoover, who was President of the United States of America during the onset of the Depression and was widely blamed for it. -Hoover blankets- are newspapers/magazines -Hoover flags- were the inside pocket lining of their pants flipped inside out (this was a symbol that they had no money and were asking for a handout from people)
Be able to determine if prices go up or down based upon the market forces of supply and demand.
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What percentage of American workers were unemployed in 1933?
-25%
Cite a statistic which demonstrates the uneven distribution of income in 1929.
-70% made $2500 or less called the poverty line
What were 2 initial steps, both ineffective, taken by Hoover once the Great Depression began?
-Agriculture -Federal spending -Hoover came up with a plan that would further anti-market by paying farmers not to grow,
Who won the presidential election of 1928? Give one reason why he won.
-Al Smith (D) vs. Herbert Hoover (R) -Hoover won, because The belief that the Catholic Church financed the Democratic Party and would rule the US if Alfred E. Smith became president, and Republicans taking credit for 1920's prosperity led to Herbert Hoover winning the presidential election in 1928.
After the crash of the stock market, what caused many banks to close?
-As the economic depression deepened in the early 1930's, and as farmers had less and less money to spend in town, banks began to fail at alarming rates
When was Black Tuesday? What happened on this day?
-Black Thursday is October 24, 1929, the first day of the stock market crash of 1929.
What are the bulls and the bears in the stock market?
-Bull markets often lead to the overvaluation of the stocks as the investors are highly optimistic and believes that the stock will always go up. Bear Market: The opposite of a bull market is a bear market, which is characterized is typically characterized with bad economy, less jobs, recession and falling share prices.
What is credit? What problem was created in the economy as a result of credit?
-Credit is large consumer debt -it became an uneven distribution of income
What is direct relief?
-Direct Relief, in the parlance of the time, meant giving monetary, food, or other aid to the unemployed, such as through some emergency housing aid and temporary unemployment in 1933, or through the creation of Social Security pensions in 1935.
Where and what was the Dust Bowl?
-Dust Bowl- massive drowt in the 1930's in the Great Plains
How did the Depression in America hurt Europe's economy?
-Europe no longer traded with the US it made unemployment worse
What part of the economy suffered the most during the 1920's? What were the reasons?
-Farmers: -prices went down by 40% -Loans for equipment: plant more crops -Higher supply, lower prices
Describe Hoover's attitude toward the Depression. What was his philosophy of government?
-Herbert Hoover did believe that the government should act to improve the economy. The old story of his belief in "rugged individualism" has been widely misinterpreted. Hoover was opposed to direct aid from government to individuals, but never took a hands off, his attitude.
Where is the Hoover Dam? Why was it built?
-Hoover Dam is a concrete arch-gravity dam in the Black Canyon of the Colorado River, on the border between the U.S. states of Nevada and Arizona. It was constructed between 1931 and 1936 during the Great Depression and was dedicated on September 30, 1935, by President Franklin D. Roosevelt.
Give 2 examples of how farmers showed their frustration in the early 1930's?
-In February 1933, thousands of farmers marched on the new capitol building in Lincoln demanding a moratorium on all farm foreclosures -Violence broke out in Loup City Nebraska when Communists tried to support a strike in a chicken plant.
According to the text, what were the four major causes of the Great Depression?
1) Tarrifs and war debts came down on the foreign markets for US goods 2) Crisis in agricultural history 3) Easy credit 4) Unequal distribution of wealth
What was the Reconstruction Finance Corporation?
Hoover's plan to use federal $ to help businesses stay open so people would not lose jobs
How did rugged individualism impact how Hoover viewed the role of government in the Depression?
-It impacted President Hoover, by making Hoover unprepared for The Great Depression crisis, Hoover's wasn't able to help the millions of Americans that were in need and needed help. The steps Hoover took were keeping the thought of limited government, this theory made it clear that a more direct government should be required. Hoover was very stubborn in his disagreement to give people money as he saw direct government aid.
Describe the effects of the Depression on women and children.
-It made it very challenging for them, because they were probably living with the kids with no money or food really to help support them. Her husband was possibly doing work or not, because a lot of people were laid off during that time, and if they didn't have a job, then it became a problem for a lot of people and there family for sure.
What was the purpose of the Reconstruction Finance Corporation (RFC)?
-It provided financial support to state and local governments and made loans to banks, railroads, mortgage associations, and other businesses.
What was the purpose of the Federal Home Loan Bank Act?
-It was an act in order to lower the cost of home ownership. It established the Federal Home Loan Bank Board to charter federal savings and loan institutions.
What was the intent of the McNary-Haugen Bill?
-It was the government price for the support of crops -the government would buy excessive crops -Coolidge vetoed it
Did the (RFC) work?
-It worked for a little bit and then was disbanded before the start of the war. RFC lending ended in 1953, and the corporation ended operations in 1957, when all remaining assets were transferred to other government agencies.
What was the Federal Home Loan Bank Act?
-Lowered mortgage rates for homeowners and allowed farmers to refinance their farm loans and avoid foreclosure
What was one project that did work?
-One project that did work was the Hoover Dam, because by the end of his presidency, Hoover almost doubled the budget for public works, which help funded the Hoover Dam- which was one of the largest government construction projects ever undertaken.
How did the Hawley-Smoot Tariff hurt America's economy?
-Other countries replied with similar measures(especially in Europe) and it was harder for American producers to export.
In the late 1920's, why were railroads in trouble? Why were coal mines in trouble? What happened to housing construction?
-Railroads were in trouble, because of the automobile industry. The railroad industry shrunk and faced economic depression. -Coal mines were in trouble, because the working conditions were horrible and the coal miners ended up being violently suppressed -Since no one could afford to buy a house during that time, the housing construction went down and people lost their jobs rapidly.
How do the terms a "shantytown", a "soup kitchen", and a "bread line" relate to the Depression?
-Shantytown-little towns within big cities made up of shacks -Soup Kitchen- place for them to gather and eat -Bread line- Common during the Great Depression, it was a place for people to wait for food handouts from charities or public agencies. -These were all places or things in hooverville by herbert hoover that made them what they are today
What is the difference between stocks and bonds?
-Stocks represent portions of ownership in a business, while bonds are loans to a company or government.
What was the significance of the 1930 congressional election?
-The 1930 election was an election for the United States House of Representatives, it was significant, because, republican policies began to fall out of favor as the majority view. During that time the Democrats gained a total of 52 seats in the 1930 election.
Describe the Bonus Army incident. How did it hurt Hoover's public image?
-The Bonus Army gets its name from the Bonus that these World War I vets were promised. They were promised a delayed cash bonus at the end of the war. ... They began to ask President Hoover to give them their money early. When Hooper refused, they gathered together and about 15,000 of them marched on Washington in 1932.
What is "rugged individualism"?
-The belief that all individuals, or all individuals can succeed on their own and that government help for people shouldn't occur.
Be able to describe the difference between speculators and investors in the stock market.
-The main difference between speculating and investing is the amount of of risk undertaken in the trade. Typically, high-risk trades that are almost akin to gambling fall under the umbrella of speculation, whereas lower-risk investments based on fundamentals and analysis fall into the category of investing
What were: "Hoovervilles", "Hooverblankets", and "Hooverflags"?
-They were the people of Hooverville, which was a shanty town built during the Great Depression by the homeless in the US. They were named after Herbert Hoover, who was President of the United States of America during the Great Depression.
Why do we pay attention to the Dow Jones Industrial Average?
-When it was created in 1896 by Charles Dow, it was meant to reflect the average price of stocks in the marketplace. Charles Dow likely chose to create a price-weighted index due to its simplicity.
What was a hobo?
-a person that has been kicked from a family that can't support them anymore or a homeless person, they get on a train not knowing where they are going
What does it mean to "buy on the margin" in the stock market?
-make a down payment on the stock and borrow the rest to pay it off
Why did attitudes toward Blacks and Latinos grow more hostile during the Depression?
-whites feel greater animus towards blacks than toward Hispanics and Asians.