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The Fed
The Fed began raising the fed funds rate in the spring of 1928. It kept increasing it through a recession that started in August 1929. When the stock market crashed, investors turned to the currency markets. -
"Black Thursday"
"Black Thursday", October 24, 1929 when 16 million shares of stock were quickly sold by panicking investors who had lost faith in the American economy. -
Stock Market
The stock market turned upward in early 1930, returning to early 1929 levels by April. This was still almost 30% below the peak of September 1929. -
Economic Collapse
Mounting losses from further stock market declines and a worsening marco-economy would further strain the banking system. -
GDP
Worldwide gross domestic product (GDP) fell by an estimated 15%. -
Business
Unemployment was at 25% and more than 5,000 banks had gone out of business. -
Gold Reserve Act
The Gold Reserve Act prohibited private ownership of gold and doubled it's price. -
Social Security Act
Congress passed the Social Security Act, which for the first time provided Americans with unemployment, disability, and pensions for old age. -
Unemployment
Unemployment fell by 2/3 in Roosevelt’s first term. Much of the economy had recovered by 1936, but persistent, long- term unemployment lasted until rearmament began for World War II in 1940. The New Deal was, and still is, sharply debated. -
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Recession
By the spring of 1937, production, profits, and wages had regained their early 1929 levels. Unemployment remained high, but it was slightly lower than the 25% rate seen in 1933. -
WWII
Nazi Germany invaded Poland, the act that started World War II. The day before, Nazi operatives had posed as Polish military officers to stage an attack on the radio station in the Silesian city of Gleiwitz. Germany used the event as the pretext for its invasion of Poland.
