Chapter+15-1.+Prosperity+Shattered

Chapter 15-1: Prosperity Shattered

Key Terms/ People:
 * Herbert Hoover President at the time expressed confidence and optimism in his inaugural address March 1929
 * Bull Market: one with an upward trend in stock prices
 * Bear market: one with a downward trend
 * Margin buying: the practice of purchasing stocks with borrowed money
 * Black Thursday: October 24 1929 prices sank to a shocking new low when panicked investors dumped more than 16 million shares of stock on the market
 * gross national product: the total value of all goods and services produced in a given year
 * Smoot-Hawley Tariff: a high tariff passed by Congress

Key Events: Economic Troubles on the Horizon Stock Market Crashes The Depression begins What caused the Great Depression:
 * Most Americans purchased new consumer products on credit, by 1929 credit was 16 times higher than in 1915
 * investors poured millions of dollars into stock market
 * Black Thursday was a large number of investors made nervous by factors like rising interests rates suddenly began to sell their shares
 * prices fell and brokers contacted customers who owed them money for stocks purchased on margin
 * impact of crash was soon felt by entire country. crash provoked a major banking crisis
 * 1930s, businesses began to fail at an alarming rate as the economy's downward slide accelerated
 * global economy had suffered enormous setbacks like war debts
 * wealthiest of income was 1% increased 63% by 1923
 * the better fiscal planning in the 1920s would not have prevented the depression