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The Great Depression is known as the worst economic disaster in US history. It happened soon after the Great Stock Market Crash of 1929. Most likely, this had roots to Herbert Hoover, (the President at the time) saying, “Prosperity is right around the corner.” At its peak The Depression caused about 15 million people to lose their jobs and hundreds of banks to close. Most of this was caused by the stock market. At this time, people were going crazy buying stocks. After men and women used up all their money buying stocks, they borrowed money to buy more stocks. These were called margin loans. When the market crashed people went crazy trying to dump their stocks, but when many of the stocks ended up worthless, people couldn't pay back their loans. On Black Thursday, about 12.9 million shares of stock were dumped. On Black Tuesday, almost 16 million shares were dumped. This tragic event effected not only the people of America, but also America’s trading partners. By 1930, 4 million people were looking for work but could not find it, and when 1931 rolled around that number increased to 6 million.
This video is an example of how innocent people were effected by the Great Depression and the Dust Bowl.
President Herbert Hoover and many other rich politicians tried to convince the people that it would all be over soon. This was not the case. By 1933 thousands of banks had shut down, so the Hoover administration came up with a different idea. By supporting failing banks with government loans, they hoped that they would be able to regain their footing and hire workers. As a former U.S. Secretary of Commerce, Hoover believed that the government had no right to intervene with the creation of jobs or the economy. The whole country came to a standstill.
Herbert Hoover promised prosperity in his election speeches. The creation of Hoovervilles was evidence that his promises would not come true for many Americans.
FDR takes action
On Inauguration Day 1933, the government ordered that all open banks were to take a “Bank Holiday”. In order to reassure the people that banks were safe, FDR famously stated, “The only thing we have to fear is fear itself.” When Roosevelt took office, the Depression was at its peak. Approximately 13 million people were unemployed. With over 20 percent of the population unemployed, the government had to do something. This brought forth the New Deal. The New Deal led to the creation of the Federal Deposit Insurance Corporation and the Securities and Exchange Commission. Both were created to prevent another Depression. Another attempt to recover from the Depression was the creation of the Tennessee Valley Authority. This provided jobs to about 8 million people in the Mid-West.
FDR, his cabinet, and the workers at the signing of the New Deal. The goal of the New Deal was to create jobs for the unemployed.
World War Two
After the end of WWI, Germany was in great debt. Angered by this, the German people let the Nazi party rise to power. The U.S was originally not involved in the war, but that all changed after the attacks on Pearl Harbor. With the U.S now in the war, factories kicked into full gear. Hundreds of jobs were produced. With the industry booming, the Works Project Administration (WPA) put more effort into strengthening United States infrastructure, which created more jobs.
U.S soldiers raising the American flag at the victory over Japan at Iwo Jima in February, 1945.