It costs money to run a business. If you are the owner, all of the money goes to you. All of it. Then you decide how to distribute that money to others. You take all of the profits that you made to pay for your employees. What happens when you lose all of your savings? YOU CAN'T PAY YOUR EMPLOYEES ANYMORE. Therefore, you have to let them go.
Unemployment skyrockets
There was a significant amount of people who lost an enormous amount of money. Therefore, many people had to close their businesses, or at the very least, let a significant amount of employees go just to keep their business alive. Unemployment was as high as 30 percent just a few short years after the Stock Crash in 1929.
Pictures to the right show thousands of people flocking to banks trying to recover their money. However, all of their fears were quickly realized, their money was no longer available to them. Pictures below are called, "Hoovervilles." President Herbert Hoover developed these as a way for families to relocate to recover from their financial shortcomings. This isn't exactly a thing of the past, however. Today, we have places called, "Tent Cities" that publicly house people without a home in larger cities. |
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Public ResponseSoup kitchens and people publicly trying to advertise their experience so that they could (potentially) run into the right person and receive a job offer. This was really the first time that there was a growing sense of the idea of a community coming together to help each other out.
During this time, there was no such thing as public assistance. The silver lining of the Great Depression is it paved the way for our government to step in and place systems to help people who are experiencing a myriad of difficulties. |
Perfect stormCoincidentally, and at the WORST time imaginable, our country experienced a great deal of adversity with a series of natural disasters. One might think a tornado or a hurricane would be the case, but it was actually dust that caused it.
It was so bad that people suffocated from inhaling dust. It was very dangerous, and it caused a significant amount of respiratory issues. That's why the last picture shows women modeling "Dust Masks." Crazy times. |
The biggest consequence of the Dust Bowl was that crops were absolutely obliterated (picture 5). This is when we go back to our supply and demand conversation. During, and after the Dust Bowl, there was a high demand but an extremely low supply.
What does that mean? If you combine people losing all of their savings during the Stock Market Crash, AND realizing that the price of food has skyrocketed, life was incredibly difficult. So much so that families had to send their children elsewhere to stay. The Dust Bowl largely affected people in the south. Families realized they did not have the means to provide for their children, so they had to send them away. Desperate times call for desperate actions, and many people did whatever they could to survive. |
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