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Summary Course on the New Deal and the 1929 Crash
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Here is a summary of the Roosevelt New Deal course, as well as the 1929 Crash
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Crash And New DealClass DNL
Class Status Pas commencé
Course: The 1929 Crisis and the Great Depression in the United
States
I. Context of the 1920s and Economic Optimism
A. Innovations and Progress
• The discovery of insulin marked a crucial medical breakthrough for treating
diabetes.
• In 1928, Herbert Hoover was elected President of the United States, boldly
stating that poverty would be eradicated with the declaration, “We are nearer
than ever to the final triumph over poverty.”
• However, just six months later, the economy dramatically shifted with the
stock market crash of October 1929, leading to the Great Depression.
II. The 1929 Crash: Origins and Consequences
A. The Stock Market Boom
• The 1920s saw a rapid rise in the stock market, attracting many who saw it as
a quick route to wealth.
• By 1929, the number of shareholders surged from 4 million to 20 million within
a population of 120 million.
B. Speculation: A Risky Gamble
• Speculators borrowed money to buy stocks, paying only 10% of the stock's
value (margin buying), and quickly sold as prices rose.
• As stock prices climbed, this overconfidence created a highly unstable
financial environment.
• By 1926, early warning signs emerged:
Crash And New Deal 1
, o Declines in the construction industry.
C. Overlooked Warning Signals
o Agricultural problems and banks being overindebted.
o Peaks in consumer goods production: Demand dropped as consumers who
could afford goods had already made purchases, while European exports were
limited by weak demand.
D. The Market Bubble Bursts: The Stock Market Crash
• On Black Thursday (October 24, 1929), panic set in as 12 million shares were
traded.
• On Black Tuesday (October 29, 1929), 16 million shares were sold, resulting in
losses of $30 billion.
E. Devastating Consequences
• Unemployment soared from 1.5 million to 12.8 million between 1929 and 1935,
affecting 25% of the workforce.
• Thousands of businesses went bankrupt, and many people were forced to
rely on soup kitchens for food.
III. The Great Depression and Its Social Effects
The crisis deeply affected families, symbolized by images of Hoovervilles
(shantytowns named after President Hoover) and soup kitchens.
• The Dust Bowl—massive dust storms—exacerbated conditions, destroying
farmland in the Great Plains and pushing thousands of rural families to migrate
to cities in search of work.
IV. Roosevelt and the New Deal: A New Beginning
A. Roosevelt, A Reformist President
• In 1933, Franklin D. Roosevelt took office and introduced the New Deal to
restore the economy. His plan had three main goals:
o Relief: Providing aid to those in immediate need.
o Recovery: Generating jobs through public works projects.
o Reform: Strengthening the economy and securing the banking system.
B. Major New Deal Programs
Crash And New Deal 2
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