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Crashing Hopes: The Great Depression


In 1929, Yale University economist Irving Fisher stated confidently: "The nation is marching along a permanently high plateau of prosperity." Five days later, the bottom dropped out of the stock market and ushered in the Great Depression, the worst economic downturn in American history. Although Americans often believe that the Crash was the starting point of the Great Depression, many historians point out that it wasn't the sole cause. This lecture examines the roots of the Crash and the effect of the Great Depression on the American public.



Some questions to keep in mind:

Why were Americans so confident in the stock market in the years leading up to the Great Depression?
How did the Psychology of Consumption shape the causes and effects of the Crash?
How did stock market investing change during the 1920s? Who were the main investors and how did they pay for their investments?
Explain the statement: "By 1929, much of the money that was invested in the stock market did not actually exist."
Why did Hoover choose the term "depression" for this economic downturn? Why do you think this term has remained part of the American vocabulary ever since?


Optimism and Prosperity
When Americans elected Herbert Hoover President in 1928, the mood of the general public was one of optimism and confidence in the United States economy. Most people believed that national prosperity would continue indefinitely. In his acceptance speech for the Republican party nomination for the presidency, Hoover had said:

"We in America today are nearer to the final triumph over poverty than ever before in the history of any land. The poorhouse is vanishing from among us."

(The rest of this article and it's photo's are here: http://us.history.wisc.edu/hist102/lectures/lecture18.html )