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The Wall Street Crash

OCR GCSE History B: USA, 1919-1941
by

David Rawlings

on 27 November 2014

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Transcript of The Wall Street Crash

Round 5. Investment
You have 3 choices again:
You can continue to speculate in the company with the chance of doubling it next turn - if so place your cash on the company square.
You can save your money in the bank. The bank decide to invest your money, put your money in the bank and move an IOU to the company square for each $100.
You can save your money in your Piggy Bank, however watch out for inflation!
Round 6. Pay Out
Oh dear, the consumers have spent all their money!
If you invested in the company, the company expanded too far, too soon. Your money has been spent on new products, but consumers are not buying them. Discard all the company's money.
If you saved with the bank. Oh dear! The bank has invested your money in the company. Your money has been spent with no pay out. Discard all money in the bank.
If you saved in your piggy bank. Your money has halved in value, but at least you still have some!
Game Setup:
1926/27:
Round 4. Pay Out:
If you invested your money in the company, well done! You have doubled your cash. Take double your investment from the consumer pile.
If you put your money in the bank, the back pay interest so it stays the same. But, they double their investment in the company. Put double the bank's investment into the bank from the consumer pile.
If you kept your money, oh dear - due to inflation it is now worth half what it was before.
http://www.history.com/videos/banking-crisis-hits-america#1929-stock-market-crash
What caused the Wall Street Crash - 1929?
Know: Reasons for the crash.
Understand: How boom led to bust.
Skills: Cause & consequence.

Bronze: Can describe reasons for the crash;
Silver: Can explain reasons using historical evidence;
Gold: Can compare causes of the crash and judge which was the most important.
C/D
B
A
Learning Objectives:
The Speculation Game
Explain why speculation caused the Wall Street Crash.
[6 marks]
Each player starts with $100 in their piggy bank.
The bank begins with 5x 'IOU's.
After each round you will decide what to do with your money.
Place extra $2000 at side of the board - this represents consumer spending.
Round 1. You have $100 in your piggy bank.
You have 3 choices:
You can invest the money in a new company with the chance of doubling it next turn - if so place your cash on the company square.
You can save your money in the bank. The bank decide to invest your money, put your money in the bank and move an IOU to the company square for each $100.
You can save your money in your Piggy Bank, however watch out for inflation!
Speculation
Wall St Crash
Point:
Explanation:
Banks
Credit
Confidence
... was vital. It meant that prices kept rising through the 1920s. However, as soon as the market slowed it dropped, when people thought prices would stop rising they all tried to sell their shares at once. The stock market came crashing down as prices were slashed.

... meant that ordinary Americans could 'buy on the margin' and borrow money to invest. This led to a huge rise in the number of investors. More investors meant a bigger crash.

... were prepared to hand out loans to practically anyone and invest in American companies. This led to a massive rise in share owners and investment in the stock market. The number of share owners rose from 4million in 1920, to 20million by 1929. When confidence dropped, all these investors tried to sell their shares at the same time so they became worthless.
TASK: In your book, match the point to the explanation.
1920
What are you going to do?
The aim of the game is to make as much money as possible!
The winner is the person with the most money.
How far was speculation responsible for the Wall St crash?
Create a sentence using these words:

1929
Wall Street
crash
speculation

Speculation - the risky lending of money to buy assets that may or may not be a good investment.
Now add this word:
important
As early as 1926, there were signs that the boom was under threat - this was seen in the
collapse of land prices
in Florida.
Eventually, there were
too many goods
being made and not enough people to buy them.
Farmers had produced
too much food
in the 1920s, so prices for their produce became steadily lower.
There were

too many small banks
- these banks did not have enough funds to cope with the sudden rush to take out savings, which happened in the autumn of 1929.
America had

lent huge sums of money

to European countries. When the stock market collapsed, they suddenly recalled those loans. This had a devastating impact on the European economy.
The collapse of European banks caused a
general world financial crisis
British people queue outside 'Northern Rock' to withdraw their money, 2007.
Americans queue outside the American Union Bank to withdraw their money, 1929.
Causes of the Wall St crash:
Wall Street Bingo:
Answers
:
Speculation
Over production
Share confidence
Europe
Farmers
Consumer goods
Small banks
Loans
1929
Unemployment
13 million
Tasks:

Create a 'Thought Cloud' to show the causes of the Wall Street Crash.

Success Criteria:
Use the causes on the board to help you;
Give each cause a short title, e.g. speculation;
More important causes should be larger.
Draw out a grid 3x3
Starter:
Back of books!
Spot the difference!
1929
2007
Bronze
:
Describe
and define speculation:
Task - write a sentence definition of speculation.
Silver
:
Explain
reasons why speculation caused the Wall St. Crash.
Task - using textbook add an explanation of why speculation caused the crash.
Gold
:
Compare
speculation to other causes of the crash - over-production, loans, loss of confidence.
Task - Diamond - 4: rank factors in order of importance - or - 'thought cloud': write factors larger for more important, smaller for less important.
Platinum
:
Evaluate
'how far' speculation was responsible for the crash.
Task - Compare your work with your partner, discuss how important you think speculation was, add an explanation of your comparison.
Learning Intentions:
On the one hand:
Speculation:
On the other hand:
Too much speculation
on the stock market - banks, businesses and ordinary americans invested money in the stock market.
Many had borrowed money
to invest, when share prices fell, they ended up in massive debt.
Too many people invested
in the stock market - this led to a huge, widespread problem when all went wrong.
How far was speculation responsible for the Wall St crash?
[10 marks]
Too much speculation
on the stock market - banks, businesses and ordinary americans invested money in the stock market.
Too many people invested
in the stock market - this led to a huge, widespread problem when all went wrong.
Many had borrowed money
to invest, when share prices fell, they ended up in massive debt.
Speculation
There were

too many small banks
- these banks did not have enough funds to cope with the sudden rush to take out savings, which happened in the autumn of 1929.
America had

lent huge sums of money

to European countries. When the stock market collapsed, they suddenly recalled those loans. This had a devastating impact on the European economy.
As early as 1926, there were signs that the boom was under threat - this was seen in the
collapse of land prices
in Florida.
Eventually, there were
too many goods
being made and not enough people to buy them.
Farmers had produced
too much food
in the 1920s, so prices for their produce became steadily lower.
Too Much Boom!
The collapse of European banks caused a
general world financial crisis
Banking Collapse
What were the consequences of the Wall Street Crash?
Bronze: Can describe consequences of the crash;
Silver: Can explain consequences using historical evidence;
Gold: Can compare consequences of the crash and judge which has the biggest impact.
C/D
B
A
Learning Objectives:
"When America sneezes, the rest of the world catches a cold."
UNEMPLOYMENT
INDUSTRIAL PRODUCTION DROP
HOUSE-BUILDING FELL
BANKING SYSTEM COLLAPSE
K: The consequences of the Wall St Crash
U: The biggest impact of the Crash
S: Evaluation
'Thought Cloud'
13 million people were out of work.

widespread poverty
no social benefits
Hoovervilles - shanty towns for homless Americans
1 in 20 farmers evicted
12,000 people made unemployed everyday
23,000 people committed suicide in one year - the highest ever in the USA
Signs went up over America saying "No men wanted"
From 1929 - 1932 5,000 banks went out of business.

Ordinary people's hard earnt money was lost as banks went bankrupt
People had speculated in the 1920s and invested their money in expanding banks and businesses that then went bust
Production dropped by 45% between 1929 - 1932. So, only half as much was being made as before the crash.
As a result people were made unemployed and factories closed.
House-building fell by 80 per cent between 1929 and 1932.

People could not buy new homes
Hoovervilles were created - shanty towns for people without homes
Tasks:

1. Create a 'Thought Cloud' on the consequences of the Wall Street Crash.

Success Criteria:
Vary the size of your consequences, based on how important each was;
Use bright colours;
You need to know how to explain each of these consequences in detail.

2. Explain the consequences of the Wall Street Crash [6 marks]

Success Criteria:
Because, because, because...
3 explained points!
P.371 will be a great help;
you have 10 minutes on this!
Four consequences:
Peer-assess your 6 mark answers!
Because, because, because...
Have they made 3 explained points?
Do they use enough detail to explain each consequence?
Give them WWW and EBI feedback.
Bronze: Can describe causes & consequences of the crash;
Silver: Can explain causes & consequences using historical evidence;
Gold: Can compare causes & consequences of the crash and judge their significance.
C/D
B
A
Learning Objectives:
K: Causes & consequences of the Wall St Crash
U: Recap and revise Wall St Crash
S: Revision

http://www.bbc.co.uk/schools/gcsebitesize/history/mwh/usa/walldepression_video.shtml
As you watch this video - take notes in the back of your book. In order to recap the causes & consequences of the Wall Street Crash.
Revision: Causes & consequences of the Crash
Task:
Create a mind-map to show the causes & consequences of the Wall St Crash.

Success Criteria:
Use the textbook pp.369-371 to help you.
Try to link causes to consequences, e.g. over-production of consumer goods meant that people working in those industries lost their jobs.
Use similar colours to link similar causes or consequences.
This is your chance to include as much detail as you possibly can!
10. The American economy did not fully recover until...
1934
1938
1941
1. The American president elected in 1928 was...
Herbert Hoover
Calvin Coolidge
Warren Harding
2. When did the Wall Street Crash happen?
October 1928
October 1929
October 1930
3. The biggest underlying economic problem was...
over production and under consumption
too much investment
severe weather
4. The Depression was most severe in...
winter 1932
winter 1934
winter 1936
5. The number of unemployed reached its peak at...
upwards of 6 million
upwards of 9 million
upwards of 13 million
6. The shanty towns that many people lived in were called...
Shantyvilles
Rooseveltvilles
Hoovervilles
7. Signs went up across America saying...
"Men wanted"
"No men wanted"
"Jobs available"
8. Who was the Democratic candidate in the presidential election of 1932?
Herbert Hoover
Franklin D Roosevelt
Calvin Coolidge
9. The election of 1932 was won by...
The Democrats
The Republicans
The Socialists
Crash
Quiz
What does this picture tell you?
What else can you infer?
Wall Street Crash - MOD source work
Are you surprised by this photograph taken in 1929?

Write down reasons why you are and aren't surprised in the back of your book.
Bronze: Can describe the source using own knowledge and
attempt to identify a message, purpose or if they are surprised
;
Silver: Can explain the message, purpose or whether they are surprised using
own knowledge

or
the
source;
Gold: Can explain the message, purpose or whether they are surprised using
own knowledge

and
the
source.
C/D
B
A
Learning Objectives:
K: Causes & consequences of the Wall St Crash
U: How to analyse a source using MOD/POD/SOD
S: Source skills
Wall Street Crash
Wall Street Crash
Wall Street Crash
What is the message of this cartoon?
Use MOD to analyse the cartoon.
Remember, the most important element is identifying the message - then your own knowledge and the source should be used to explain it.
You have 5 minutes
Why was this photograph taken in 1931?
Use POD to analyse this cartoon.
You should start with what the purpose of taking this photo was. What did the photographer want to show?
Then explain using the photo and your own knowledge.
You have 5 minutes
Are you surprised by this source?
You need to identify two elements in these questions.
On the one hand - why you are surprised.
On the other hand - what you aren't surprised about.
Make sure you use your own knowledge and the source to explain both parts.
You have 5 minutes
3/7
5/7
7/7
M
"The main message of the cartoon is... "
Finished
Own Knowledge
Look at all details in the cartoon.
Think about who it is FOR or AGAINST.
This will help you to identify the
message
the cartoonist was trying to make.
Details from the cartoon
Take 2 minutes to identify the message
Message
Identify the message.
What do you know that supports this message?
Think about:
The characters involved;
The date of the cartoon.
What details in the cartoon also support your message?
Be OBSERVANT!
Look at every detail and read the caption if there is one.
This should be a clear political message.
Well done!
You're now an expert at evaluating cartoons!
Now practice, practice, practice!
[7 marks]
D
What does it tell you?
What point is it trying to make?
'This message is supported by the fact that...'
'The message is shown in the cartoon by the...'
Markscheme
Wall Street Crash
TASK: choose one of the three sources and write it up as a GCSE style answer.
You have 5 minutes
Now swap books with the person next to you.

Give them a mark using the GCSE mark-scheme below:
Bronze: Can describe the source using own knowledge and
attempt to identify a message, purpose or if they are surprised
;
Silver: Can explain the message, purpose or whether they are surprised using
own knowledge

or
the
source;
Gold: Can explain the message, purpose or whether they are surprised using
own knowledge

and
the
source.
C/D
B
A
3/7
5/7
7/7
Markscheme
Add WWW and EBI feedback to their work.
Homework - prepare for a 7 mark source based question next lesson.
It will be on the Wall Street Crash and is a formal assessment.
Round 2.
If you invested your money in the company, well done! You have doubled your cash. Take double your investment from the consumer pile.
If you put your money in the bank, the back pay interest so it stays the same. But, they double their investment in the company. Put double the bank's investment into the bank from the consumer pile.
If you kept your money, oh dear - due to inflation it is now worth half what it was before.
Round 3. Investment
You have 3 choices again:
You can continue to speculate in the company with the chance of doubling it next turn - if so place your cash on the company square.
You can save your money in the bank. The bank decide to invest your money, put your money in the bank and move an IOU to the company square for each $100.
You can save your money in your Piggy Bank, however watch out for inflation!
Task 1
: Set up a company to sell your product and prepare to float it on the stock market. You will need to convince investors to buy shares in your company and back you with cash.

Success criteria for a successful company:

• Business plan – how are you going to make money?





It is the 1920s and you have a brilliant idea for a new consumer good. You have invented a new:

• Radio
• Car
• Washing machine
• Refrigerator

Task 2:

Plan a pitch to convince the investors to back your company.

Explain how your company meets the success for a good business.
Task 3
: Exam Alert!

[4 marks] What was speculation?

Answer this question in your book.

Remind yourself of what is required on a 4 mark question!
Lesson Aim:
To assess how far speculation was responsible for the Wall St Crash.
1941
Wall Street
Roaring Twenties
Herbert Hoover
Prohibition
WW2
Dust bowl
Hooverville
'Speculation was the main cause of the crash.'
NO
YES
Full transcript