Name ______Date ______Period _____
Primary Documents: The Great Depression
Directions: Read the primary documents and answer the questions.
Stock Market Crash, 1929 – Jonathan Norton Leonard (1944)
1) As the market began to crash, who wanted to sell?
2) As news worsened on Monday the 28th, what did the bankers start telling people was on the horizon? Why do you think the bankers did this?
3) What percentage of their value had the leading stocks lost by the end of Tuesday, October 29th?
During the Depression – Frederick Lewis Allen (1939)
4) What examples of the Great Depression did Allen say were visible?
5) What business did Allen say was least affected by the Great Depression? Why?
6) How were most of the job-searchers moving from city to city in 1933?
7) How did the Great Depression change life for the Jones family?
8) Why does the author say that some people would not go back to work even if they found jobs?
9) Briefly summarize the two quotes at the end of the reading?
First Inaugural Address – Franklin Delano Roosevelt (1933)
9) FDR’s statement: “So, first of all, let me assert my firmbelief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance” is very famous. It is often mistakenly believed to be related to WWII. Obviously it is not since WWII began in 1939. So…what is he trying to say?
10) How does FDR compare the problems of the Great Depression to the problems faced by America’s forefathers?
11) What does FDR says is the most important task for the government to undertake? Does this make sense? Explain.
12) What two safeguards does FDR suggest? Do you think that these are important? Explain.
13) Upon whose spirit does FDR say Americans must call in order to rebuild the economy? What does he mean?
14) In this speech FDR introduces what is now known as the Good Neighbor Policy. As his administration progressed, the Good Neighbor Policy came to mean that the United States wished to have good relations with its neighbors, especially at a time when conflicts were beginning to rise once again. This policy was more or less intended to solidify Latin American support for the U.S.. The Good Neighbor Policy meant that the United States would keep its eye on Latin America in a more peaceful tone. Avoiding military intervention, the United States shifted to other methods to maintain its influence in Latin America: Pan-Americanism, support for strong local leaders, the training of national guards, economic and cultural penetration, Export-Import Bank loans, financial supervision, and political subversion. The Good Neighbor Policy resulted in the withdrawal of U.S. Marines from Haiti and Nicaragua in 1934 and the annulment of the Platt Amendment in that same year. The era of the Good Neighbor Policy ended with the threat of the Cold War in 1945 as the U.S. became increasingly interested in military and non-military interventions to contain the spread of communism. So…what was the Good Neighbor Policy? How did the Good Neighbor Policy differ from U.S. policy in Latin America in the 35 years prior to FDR?
15) For whose good does FDR say that he, the government, and all Americans must work?
Eleanor Roosevelt in the White House – Raymond Clapper (1944)
16) What is the point of Clapper’s anecdote about Eleanor Roosevelt and the Virginia Reel (a dance)?
17) To what presidential power does Clapper compare a statement from Eleanor Roosevelt?
18) How did Eleanor Roosevelt get around the country? Does this surprise you?
19) Who does the author say that Eleanor Roosevelt has helped? Does this surprise you?
20) Many people say that Eleanor Roosevelt was ahead of her time. Would you agree? Explain.
Stock Market Crash, 1929 – Jonathan Norton Leonard (1944)
Stock prices were incredibly high in October 1929. The so-called bull market could not last. On Thursday, October 24, the stock market plunged, providing a warning of the crash thatwas to come on full force beinning on the following Tuesday. Jonathan Norton Leonard, a journalist and historian, described what happenedin these excerpts from his 1944 book “Three Years Down”.
That Saturday and Sunday Wall Street hummed with week-day activity.The great buildings were ablaze with lights all night as sleepy clerks foughtdesperately to get the accounts in shape for the Monday opening. Horrifiedbrokers watched the selling orders accumulate. It wasn’t a flood; it was adeluge. Everybody wanted to sell—the man with five shares and the man withten thousand. Evidently the week-end cheer barrage had not hit its mark.
Monday was a rout for the banking pool, which was still supposed to be"on guard." If it did any net buying at all, which is doubtful, the market paidlittle attention. Leading stocks broke through the support levels as soon astrading started and kept sinking all day. Periodically the news would circulatethat the banks were about to turn the tide as they had done on Thursday, butit didn't happen. A certain cynicism developed in the board rooms as the daywore on. Obviously the big financial interests had abandoned the market to itsfate, probably intending to pick up the fragments cheap when the wreck hitthe final bottom. "Very well," said the little man, "I shall do the same."
When the market finally closed, 9,212,800 shares had been sold. TheTimes index of 25 industrials fell from 367.42 to 318.29. The whole listshowed alarming losses, and margin calls were on their way to thosespeculators who had not already sold out.
That night Wall Street was lit up like a Christmas tree. Restaurants, barbershops, and speakeasies were open and doing a roaring business. Messengerboys and runners raced through the streets whooping and singing at the topsof their lungs. Slum children invaded the district to play with balls of tickertape. Well-dressed gentlemen fell asleep in lunch counters. All the downtownhotels, rooming houses, even flophouses were full of financial employees whousually slept in the Bronx. It was probably Wall Street's worst night. Not onlyhad the day been bad, but everybody down to the youngest office boy had apretty good idea of what was going to happen tomorrow.
The morning papers were black with the story of the Monday smash.Except for rather feeble hopes that the great banks would step into the gapthey had no heart for cheerful headlines. In the inside pages, however, thesunshine chorus continued as merry as ever. Bankers said that heavy buyinghad been sighted on the horizon. Brokers were loud with "technical" reasonswhy the decline could not continue. . . .
These noble but childish dabbles in mass psychology failed as utterly asmight have been expected. Even the more substantial contributions of U.S.Steel and American Can in the shape of $1 extra dividends had the same fate.Ordinarily such action would have sent the respective stocks shooting upward,but in the present mood of the public it created not the slightest ripple ofinterest. Steel and Can plunged down as steeply as if they had canceled theirdividends entirely. The next day, Tuesday, the 29th of October, was the worstof all. In the first half hour 3,259,800 shares were traded, almost a full day’swork for the laboring machinery of the Exchange. The selling pressure waswholly without precedent. It was coming from everywhere. The wires to othercities were jammed with frantic orders to sell. So were the cables, radio andtelephones to Europe and the rest of the world. Buyers were few, sometimeswholly absent. Often the specialists stood baffled at their posts, sellers pressing around them and not a single buyer at any price.
This was real panic. It was what the banks had prevented on Thursday,had slowed on Monday. Now they were helpless. Reportedly they were tryingto force their associated corporations to toss their buying power into thewhirlpool, but they were getting no results. Albert Conway, New York StateSuperintendent of Insurance, took the dubious step of urging the companiesunder his jurisdiction to buy common stocks. If they did so, their buying wasinsufficient to halt the rout.
When the closing bell rang, the great bull market was dead and buried.16,410,000 shares had changed hands. Leading stocks had lost as much as77% of their peak value. The Dow Jones index was off 40% since September3. Not only the little speculators, but the lordly, experienced big traders hadbeen wiped out by the violence of the crash and the whole financial structureof the nation had been shaken to its foundations. Many bankers and brokerswere doubtful about their own solvency, for their accounting systems hadbroken down. The truth was buried beneath a mountain of scribbled paperwhich would require several days of solid work to clear away.
During the Depression – Frederick Allen Lewis(1939)
By 1932 the Great Depression was fully under way. Unemployment soared, machines layidle, and Americans suffered greatly. Frederick Lewis Allen described how things looked atthe time in these excerpts from his 1939 book, “Since Yesterday”.
Walking through an American city, you might find few signs of thedepression visible—or at least conspicuous—to the casual eye. Youmight notice that a great many shops were untenanted, with dusty plateglass
windows and signs indicating that they were ready to lease; that few factorychimneys were smoking; that the streets were not so crowded with trucks as inearlier years, that there was no uproar of riveters to assail the ear, that beggarsand panhandlers were on the sidewalks in unprecedented numbers (in the ParkAvenue district of New York a man might be asked for money four or fivetimes in a tenblock walk). Traveling by railroad, you might notice that thetrains were shorter, the Pullman cars fewer—and that fewer freight trains wereon the line. Traveling overnight, you might find only two or three otherpassengers in your sleeping car. (By contrast, there were more filling stationsby the motor highways than ever before, and of all the retail businesses . . .only the filling stations showed no large drop in business during the blackyears; for although few new automobiles were being bought, those whichwould still stand up were being used more than ever—to the dismay of therailroads.)
Otherwise things might seem to you to be going on much as usual. Themajor phenomena of the depression were mostly negative and did not assailthe eye.
But if you knew where to look, some of them would begin to appear. First, the breadlines in the poorer districts. Second, those bleak settlements ironicallyknown as "Hoovervilles" in the outskirts of the cities and on vacant lots—groups of makeshift shacks constructed out of packing boxes, scrap iron, anything that could be picked up free in a diligent combing of the city dumps:shacks in which men and sometimes whole families of evicted people weresleeping on automobile seats carried from auto-graveyards, warmingthemselves before fires of rubbish in grease drums. Third, the homeless peoplesleeping in doorways or on park benches, and going the rounds of therestaurants for leftover half-eaten biscuits, piecrusts, anything to keep the firesof life burning. Fourth, the vastly increased number of thumbers on thehighways, and particularly of freight-car transients on the railroads: a hugearmy of drifters ever on the move, searching half-aimlessly for a place wherethere might be a job. . . . It was estimated that by the beginning of 1933, thecountry over, there were a million of these transients on the move. . . .
Among the comparatively well-to-do people of the country (those, let ussay, whose pre-depression incomes had been over $5,000 a year) the greatmajority were living on a reduced scale, for salary cuts had been extensive,especially since 1931, and dividends were dwindling. These people weredischarging servants, or cutting servants’ wages to a minimum, or in somecases "letting" a servant stay on without other compensation than board andlodging. . . . When those who had flown high with the stock market in 1929looked at the stock-market page of the newspapers nowadays their onlyconsoling thought (if they still had any stock left) was that a judicious sale ortwo would result in such a capital loss that they need pay no income tax at allthis year.
Alongside these men and women of the well-to-do classes whose fortuneshad been merely reduced by the depression were others whose fortunes hadbeen shattered. The crowd of men waiting for the 8:14 train at the prosperoussuburb included many who had lost their jobs, and were going to town asusual not merely to look stubbornly and almost hopelessly for other work butalso to keep up a bold front of activity. . . . There were architects andengineers bound for offices to which no clients had come in weeks. There weredoctors who thought themselves lucky when a patient paid a bill. Mrs. Jones,who went daily to her stenographic job, was now the economic mainstay ofher family, for Mr. Jones was jobless and was doing the cooking and lookingafter the children (with singular distaste and inefficiency). Next door to theJoneses lived Mrs. Smith, the widow of a successful lawyer: she had always hada comfortable income, she prided herself on her "nice things," she waspathetically unfitted to earn a dollar even if jobs were to be had . . .
Further down in the economic scale, particularly in those industrialcommunities in which the factories were running at twenty per cent ofcapacity or had closed down altogether, conditions were infinitely worse. . . .In every American city, quantities of families were being evicted from theirinadequate apartments; moving in with other families till ten or twelve peoplewould be sharing three or four rooms; or shivering through the winter inheatless houses because they could afford no coal, eating meat once a week ornot at all. If employers sometimes found that former employees who had beendischarged did not seem eager for re-employment ("They won’t take a job ifyou offer them one!"), often the reason was panic: a dreadful fear ofinadequacy which was one of the depression’s commonest psychopathologicalresults. A woman clerk, offered piecework after being jobless for a year,confessed that she almost had not dared to come to the office, she had been in such terror lest she wouldn’t know where to hang her coat, wouldn’t knowhow to find the washroom, wouldn’t understand the boss’s directions for herjob. . . .
At the very bottom of the economic scale the conditions may perhaps bestbe suggested by two brief quotations. The first, from Jonathan NortonLeonard’s Three Years Down, describes the plight of Pennsylvania miners whohad been put out of company villages after a blind and hopeless strike in 1931:"Reporters from the more liberal metropolitan papers found thousands ofthem huddled on the mountainsides, crowded three or four families togetherin one-room shacks, living on dandelions and wild weed-roots. Half of themwere sick, but no local doctor would care for the evicted strikers. All of themwere hungry and many of them were dying of those providential diseaseswhich enable welfare authorities to claim that no one has starved." The otherquotation is from Louise V. Armstrong’s We Too Are the People, and the sceneis Chicago in the late spring of 1932: "One vivid, gruesome moment of those dark days we shall never forget.We saw a crowd of some fifty men fighting over a barrel of garbage outside theback door of a restaurant. American citizens fighting for scraps of food likeanimals!"
First Inaugural Address – Franklin Delano Roosevelt (1933)
When President Franklin D. Roosevelt took office in 1933, the nation was undergoing aneconomic disaster. People were unemployed, hungry, and afraid. The nation waitedanxiously to see what the new president would do. The following is his heartening FirstInaugural Address, given on March 4, 1933.
I am certain that my fellow Americans expect that on my induction into thePresidency I will address them with a candor and a decision which thepresent situation of our Nation impels. This is preeminently the time to speakthe truth, frankly and boldly. Nor need we shrink from honestly facingconditions in our country today. This great Nation will endure as it hasendured, will revive and will prosper. So, first of all, let me assert my firmbelief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat intoadvance. In every dark hour of our national life a leadership of frankness andvigor has met with that understanding and support of the people themselveswhich is essential to victory. I am convinced that you will again give thatsupport to leadership in these critical days.