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Stock Market Crash of 1929
On this date, the Stock Market crashed, leading to the beginning of the Great Depression. Stocks worth billions of dollars were lost, wiping out thousands of investors. Banks and businesses closed, millions of people lost their jobs, and debts rose. -
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Great Depression
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Smoot-Hawley Tariff
President Hoover signed the Smoot-Hawley Tariff Act to help farmers. The tariff raised taxes on imports. Other countries retaliated by raising their own import tariffs, resulting in a trade war. Due to high tariffs on other countries, the United States couldn't export their goods, preventing the US from gaining money. -
FDR Steps Into the Office
Franklin Delano Roosevelt took office in March 4, 1933. He launched the New Deal program on March 9 with the Emergency Banking Act. He introduced the New Deal program to try and pull the US out of the depression. -
The Depression Comes to an End
When Hitler conquered France and bombed London, FDR increased the defense budget and raised the top income tax rate to 81 percent. In result, the economy grew 8.8 percent and unemployment fell to 14.6 percent only. -
OPEC Embargo Begins
In response to US support for Israel during the Arab-Israeli War, the members of OPEC decided to put an oil embargo, which eventually included Western Europe and Japan. -
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OPEC Oil Embargo
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Introduction of Project Independence
Henry Kissinger, Nixon's Secretary of State, introduced Project Independence. The program was designed to make the US less dependent on foreign sources of oil and gas. -
Nixon Responds
The Emergency Petroleum Allocation Act authorized federal controls over the price, production, and marketing of oil and gas. It was just one of many government efforts to manage the effects of the embargo. -
Gas Lines Form
As gasoline became a rare resource in the winter, long lines formed at gas stations because of the scare of not having any gas. Having more demand than the supply, a lot of gas stations went out of business. -
Consumers Answer Back
In the third month of the OPEC Embargo, consumers started realizing how they can help. People bought smaller and energy-efficient cars to save gas. They also saved energy by lessening the use of hot water, heat, and air conditioning at home. -
The Embargo is Lifted
OPEC agreed to end its embargo after Israel withdrew the last of its troops from the west side of the Suez Canal. -
Fed Raised Interest Rates
By 2004, housing prices were skyrocketing. The Federal Reserve started raising interest rates to cool off the market. In 2006, the new Federal Reserve Chairman, Ben Bernanke, raised the rate four times, hitting 5.25 percent by June 2006 -
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Housing Crisis Of 2008
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Home Prices Fall for the First Time in 11 Years
Prices for houses fell because of the huge amount of unsold inventory. At the current rate of sales that year, it would take 7.5 months to sell that inventory. -
The Creation of the 2008 Banking Crisis
As home prices fell, bankers lost trust in each other. No one wanted to lend to each other because they would receive mortgage-backed securities. Because the banks didn't lend to each other, the whole financial system collapses.
