Thursday October 24 1929 is a Day that was later known as “Black Thursday”.
“Black Thursday” was the day a small crash occurred at the New York stockexchange. However “Black Thursday” Would turn out to be nothing compared towhat awaited America and its economy on the following Tuesday. America was aboutto enter her darkest days the Great Depression. Sena Peterson my greatgrandmother was just an eighteen-year-old young lady living on her fathers cornfarm in Iowa. Far away from New York and the economic problems on Wall Street. Nevertheless, the depression and the falling prices of her farms product wouldsoon affect her in drastic ways the depression would be a hard time forAmericans.
Monday October 28, 1929. Was a very dark and gloomy day. Thousands ofBlack Birds landed on Wall Street. The thousand plus birds began to devour anything they could find to eat. Nearly half of the birds never took flight again.
Many of the birds died of exhaustion. This was an ominous sign of the dark anddesperate times ahead. America was about to enter its lowest and darkest pointin its short history. My great grandma lived on her farm in Iowa oblivious tothe fact that her life would soon be changing in drastic ways.
She had know ideaof what was going on at Wall Street. She had no idea that she was going to haveto move. Her family would soon have to start all over in a new place. TuesdayOctober 29, 1929. This dark day would soon be remembered as “Black Tuesday”.
The day Americas economy would crumble. The day some investors lost everythingeven there will to live and jumped out the windows of high rise buildings. Manypeople believe that the stock market crash was the cause of the depression butthat is not entirely true. Although the two events where closely related.
ByAmericans attitude during the 1920’s also known as the jazz age. Americansemphasis on having the newest thing or being at the height of fashion was enoughto keep the economy going for most of the 20’s but that would no last. Duringthe First World War my great grand mothers expanded to keep up with the demandthe war created. To do this they got a loan from the bank to purchase the needsupplies; machines and the land needed to expand. After the war ended the demandfor corn drastically dropped. Consequently, the farm produced an excess productso the price dropped.
My great grandfather now had problems paying the bill andmaking ends meat but he managed for a while. Nevertheless, the lack of moneywould soon take its toll. The problem with the way America was heading was thatincome was distributed very unevenly and the portion going to the rich gotlarger and larger as the 20’s progressed. Corporations started to make biggerand bigger profits yet the profits were not passed on to the workers. Inaddition, in 1926, The Revenue act was passed and it cut taxes by 2/63 for thosewho made over 1 million dollars a year. Because of these trends in 1929, the top.
1 percent of American families had a total income equal to the bottom 42percent. That meant that the people who paid attention to the ads couldn’tafford the new products they wanted. This is when credit was invented. Peopleliked the idea that they didn’t have to pay for the product but they still gotto keep it and pay later. Credit only put of they day when consumers accumulatedso much debt that they couldn’t buy new products.
My Great Great grandfatherhad tried his best to make ends meat but he couldn’t make a profit. He couldno longer pay back his loan to the bank so they foreclosed on his farm. My greatgrandmother’s family now had no source of income and no where to live for themthis was the lowest point of the depression and her life. However, this whereabout get a lot worse for the Peterson family.
Because people could no longerafford to buy things there was an over supply and no demand, so prices began tofall like a rock. So they economy became weak because nobody was making money. This is when stocks began to crash and eventually the whole market crashed. Things began to look a lot worse for the Peterson’s my great grandmother’sfather came down with tuberculoses. The whole Peterson family had to move toColorado so he could get treatment. My great grandmother ended up working in aLevi’s factory to help pay medical bills as well as her mother.
Her brothersworked in other various factories. These events all lead up to the depressionthe stock market crash was the straw that broke the horses back. After the crashfor the next three years things just got worse and worse. Americans attitudeschanged from their happy party like attitudes to a defeat and despair. Stockprices continued to fall, by 1932 they where 20 percent what they where beforethe crash. With little demand many mills and plants closed.
They plants thathere still open in 1932 produced only half what they did in 1929. There was noend in sight America looked as if it where in a never-ending downward spiral. The Peterson’s continued to work in factories to pay for the medical bills. Until her father died. She continued to work in the factory but some of herebrothers joined the Navy. She worked in the factory until she got married in1932 and she started to do housekeeping to make a living while her husbandworked for a chemical company called Dow Chemicals.
From 1929 to 1932,unemployment went from 3. 2 percent to 24. 9 percent. This mean there where 15million unemployed Americans.
People who had a job where earning very littlemoney. My great grandmother husband worked for the chemical plant he didn’tmake enough to support his family wick included there two suns and doughtier. Buster and Glen where the names of there sons. Buster was born in 1930, Glen wasborn in 1933, and their doughtier Janice was born in 1936. Many other familieswhere not as lucky. As people lost their money and their savings, they could nolonger pay their loans and mortgages.
Banks began to foreclose on them they losteverything there houses and all. These unemployed homeless people lived inshantytowns in houses made from old crates. These towns would soon be calledHoovervilles because Americans where bitter towards there president. The peopleof America where upset at President Hoover because he refused to give aid to theunemployed Americans.
The way my Great Grandmother was living was a sharpcontrast to the way it was just a few years. Yet it was still a tuff time theycould pay the bills and she didn’t have to do hard work in factories. They waythe government responded to the depression initially did not help to fix theproblem. President Hoover insisted that prosperity would soon return to America. Hoover was convinced that all he needed to do was to restore people’sconfidence so that companies would invest and start production again. Hebelieved that this would create more jobs and give people incomes and restorethe economy.
Nevertheless, business owners saw no reason to increase productionbecause there shelves where full of unsold items. By 1932, production was lessthat what it had been in 1929. President Hoover also believed that a balancedbudget was the key to restoring the economy. Hoover decided to cut governmentspending and increase taxes. All Hoover’s plan did was reduced demand to anall time low. Eventually Hoover provide emergency loans to banks and industrialcompanies.
President Hoover also expanded public works and helped states offerrelief. However, his efforts where too little, too late. President Hoover was aself made man and as such he strongly believed in individualism andself-reliance. More and more Americans began to loose their jobs Hoover saidthat “mutual self help through voluntary giving” was the way to meetspeoples needs. Charities began to be overwhelmed at the number of people thatneeded help.
To most people government assistance was the only way to help fixAmericas economic problems. Hoover thought that giving government help wouldundermine recipient’s self-reliance and he refused to do it the entire time hewas in office. In 1932, there was an election and democrat Franklin DelanoRoosevelt would run against the very unpopular and somewhat hatted PresidentHoover. Many people believed that Roosevelt would win by a landslide and he didin the fall of 1932. Roosevelt was a very confident person unlike Hoover.
In hisinauguration speech, he said, “The only thing we have to fear is fear itself”. Soon Americans spirits would be lifted. Days after his inaugurationRoosevelt called special sessions with congress where there where severalemergency legislation was passed. These new legislation where called The NewDeal The basic idea of the new deal was to lower the supply of goods to thecurrent depressed level. The New Deal also tried to increase demand by puttinglarge amounts of money into the economy through the Public Works program. ThePublic Works program provided jobs and it built schools dams and roads.
The newdeal was not a cure for the depression it acted like a painkiller lessening theburden on Americans and making condition bearable. Unemployment was reduced andframers could now sell their crops for a profit. However, the depression was notover. The depression is thought to be over around the time the Second World Warstarted. The demand the war created helped fix the economy companiese could selltheir products there was now the demand was equal to the supply.
The economy wasfixed. America was once more a prospering country.