U.S economy had problems which led to many people in poverty. Families needed at least two thousand dollars to pay for basic needs. Farmers also faced difficulties. Foreign demands dropped and prices fell. Many` bought the stocks on margin. Few people recognized these problems millions still continued to buy stocks. Millions of panicky investors sold their stocks and the stock market plunged. This was the start of an economic depression also known as the great depression.
It was the longest and most severe depression ever experienced by industrial western world, sparking fundamental changes in economic institutions. the Great Depression represented the harshest adversity faced by Americans since the Civil War three. Abandonment of the gold standard enabled some countries to increase their money supplies, which arouse spending, lending, and investment.
Another thing that compounded the nation during the Great Depression was banking panics or bank runs. during which large numbers of anxious people withdrew their deposits in cash, forcing banks to liquidate loans. The first four banking runs began in 1930, when a run in Nashville, Tennessee influenced many more incidents throughout the southeast.
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large numbers of anxious people withdrew their deposits in cash, forcing banks to liquidate loans. During a bank run, a bank must quickly liquidate loans and sell its assets (often at rock-bottom prices) to come up with the necessary cash, and the losses they suffer can threaten the bank’s solvency. The bank runs of 1930 were followed by similar banking panics in the spring and fall of 1931 and the fall of 1932. In some cases, bank runs were started simply by rumors of a bank’s inability to pay out funds.
Many other things happened in the 1930s, children worked as coal miners. Coal miners were the poorest before the depression and after the depression. They worked for minimum wages and were near slaves to coal companies. They lived in company homes and were paid with company money. They were forced to buy daily needs from company-owned stores where prices were extremely high. It worsened when coal companies cut back production and shortened hours.
Eleanor Roosevelt received various requests for help from the poor and inactive.Many of the letters came from young children and teenagers whose parents were hardly able to give them food and clothes. Toys, bicycles, and sports equipment were beyond the means of many families, but boys and girls of course still coveted them.
On March 12, 1933, Roosevelt gave the first of what would become known as the “fireside chats,” or speeches broadcast over the radio in which he addressed the American people directly. In that first fireside chat, Roosevelt spoke of the bank crisis, explaining the logic behind his closing of all banks and stating that “Your government does not intend that the history of the past few years shall be repeated.
We do not want and will not have another epidemic of bank failures.” He reassured the nation that banks would be secure when they reopened, and that people could trust that they could use their money as they saw fit at any time. “I can assure you, my friends,” Roosevelt intoned, “that it is safer to keep your money in a reopened bank than it is to keep it under the mattress.”
Roosevelt’s words and actions helped to begin the process of restoring public confidence, and when the banks reopened many depositors showed up ready to deposit their currency or gold, signaling the end of the nation’s banking crisis.
