Introducing 

Prezi AI.

Your new presentation assistant.

Refine, enhance, and tailor your content, source relevant images, and edit visuals quicker than ever before.

Loading…
Transcript

THE AMERICAN RICH IN THE 1920s

During the 1920s the prosperity in the lives of the already wealthy increased rapidly. Here is why, how and who!

What caused the 1920s economic boom?

Cause of the boom

The newfound economic prosperity of the 1920s was prompted by a number of factors.

These include technological progress, new marketing techniques, changes in the banking industry, the electrification of America and an increase in employment which produced an increase in consumers.

The advance in technology

Image of 1920s converyer belt

source: https://blog.habasit.com/uncategorized/history-conveyor-belt/

Technological progress

Due to technological advances new industries were developed and productivity was increased in pre-existing ones. New machinery, such as conveyer belts and concrete mixers, was created which transformed the work scene completely. The conveyer belt and assembly line that was pioneered by Henry Ford is a prime example of this change. Using his new method meant that more goods were being produced and faster than ever before. Most of these machines did not require great skill to operate which meant that factories were able to hire almost anyone. This led to more employment and lower prices for these ‘lower-work’ goods. The combination of these cheaper products and increased employment further increased the demand for goods, creating a boom in consumerism and a prosperous economy.

Image of Ford

source:https:www.npr.org/2014/01/27/267145552/the-middle-class-took-off-100-years-ago-thanks-to-henry-ford

New marketing techniques

As the purchasing of goods had increased rapidly, new clever marketing techniques to match this sudden demand were created. Businesses used inventive and eye-catching ways to appeal to their target audience. Business increased their advertising budgets and advertisements were placed in magazines and newspapers, on billboards, shop windows and cinemas and played on the radio. New lengths were gone to persuade the population to purchase goods, such as the hiring of movie stars and sports figures to serve as ethos.

Examples

Source: Vintage Everyday

Source: https://pixels.com/featured/national-oats-1920s-usa-cereals-the-advertising-archives.html

Source: https://vintagedancer.com/1920s/ladies-1920s-sweaters/

Banks and the stock market

"In other words—don't hesitate to invest your cash!”

-Banker and financial swindler, Charles Ponzi, circa 1920.

Businesses began to raise finance by selling shares on the stock market. People started buying their own shares and quickly it became a common activity. Even people who could not afford them began to buy them ‘on the margin’. This meant only putting down a small amount of one’s own money and borrowing the rest from a broker. Newly emerging credit firms allowed for consumers to pay for goods in instalments at low interest rates. This meant that Americas who could not previously afford expensive items could now buy them. This demand for extra goods also led to more jobs and therefore more consumers. America's economy grew faster than ever before.

Image: Wall Street in the 1920s

Source: The New York Times

Banks and the stock market

More Money Statistics!

- Per-capita GDP rose from $6,460 to $8,016 per person

- The Dow Jones Industrial Average jumped from a value of 71.95 points at the beginning of 1921 to a high of more than 381 points before the market crashed in October 1929

The electrification of America

Electrification

The electricity industry thrived in the 1920s and provided a cheap and efficient source of power for factories. It enabled the mass production techniques that had recently come into use (eg. the conveyer belt). Electricity also supplied the power needed in the homes of consumers for all of the new mass produced products such as fridges, vacuum cleaners and washing machines.

Electricity also powered the millions of radios that were now in use as well as cinemas and speakeasies.

Image: Advertisement for the hoover in the 1920s. The hoover was a revolutionary new item that was able to operate due to the new electricty in America.

Source: https://edu.glogster.com/glog/new-appliances-of-the-1920s/2ctcbur5pdw

Evidence of economic prosperity in the roaring 20s

Evidence

This quote from U.S president Warren Harding reflects the atmosphere at the beginning of this extremely prosperous era:

‘I would like to acclaim an era of good feeling amid dependable prosperity and all the blessings which attend.’ (Inaugural Address, March 4, 1921).

In the years of the roaring twenties America’s economy grew 42 percent. Income levels rose and workers made 29 percent more in 1928 than they did in 1919. Business growth, new construction and trading in the stock market grew as well. Production rose by 60 percent from 1920 to 1930 and unemployment rates were low.

Although not everybody was wealthy, many more people were able to spend money. The expansion of the auto industry also brought economic benefits for society. Governments spent $1 billion to build new roads, bridges, and traffic lights. Gas stations, motels, and restaurants were created for drivers who were covering long distances and insurances companies began providing car insurance.

The most positevely effected by this flourishing economic were those who were rich to begin with. Thanks to the business market and money flow in the economy they were spending and gaining money at a rate like never before.

Image showing the position of the rich during the roaring 20s. Source: https://ethanhansn.weebly.com/false-prosperity.html

More

Cartoon in the LA Times demonstrating the feeling in society. Source: http://americainclass.org/sources/becomingmodern/prosperity/text1/politicalcartoons.pdf

How society changed

Societal change

The majority of society used to work either on farms or as skilled craftsmen. They used to work in quieter, small settings where there was emphasis on doing the job well not on getting it done as fast as possible. But as people began flocking to cities and out of rural areas and factories were popped up everywhere this changed.

In factories work was done fast and it was always crowded and noisy. The number of items produced became more important than the accomplishments of an individual worker. Labourers in factories worked long hours in harsh conditions and young children were commonly employed. The number of women in the workforce was also rising.

Immigrants from southern and eastern Europe (from countries such as Greece, Poland and Italy) began to migrate to the United States. This was due to the prosperity that the United States promised and in hopes of a starting a better life.

The improved railroad industry now meant that goods were being transferred from far away and that people could communicate with others from places that used to be too far away.

Ford was determined to create a ‘small and cheap’ car that would be ‘available to as many consumers as possible’ and he achieved this goal. Other companies followed suit and soon the Ford wasn’t the only car on the market. Cars were soon popular as they gave one the freedom to travel further and do more than ever before. Because of cars individuals were not only travelling between work and home but from region to region as well.

Image of immigration to U.S. Source: americanlearning.com

More

Motor vehicle sales in the 1920s. Source: the1920samericausa.com

Who benefited from the economic boom

Image showing the distribution of wealth in the 1920s. Source: http://slideplayer.com/slide/15862404/

Who benefited

The flowering economy was a highly beneficial thing to many living at the time. The majority of the benefits were received by those who were already rich and those who sat above the middle class. Between 1919 and 1929, the share of income received by the richest five percent jumped from 24 percent to 34 percent. The increased production widened the gap between rich and poor, but the real earnings of employed wage earners still increased about 22 percent.

Already existing advertising agencies expanded, and new ones were started, all of these made large profits from the new prominent role that advertising had occupied in the public. An example of this was the J. Walter Thompson agency which saw profits rise from $10.7 million in 1922 to $37.5 million in 1929.

The immense growth of the railroad system meant that great wealth and power was being brought to those who controlled it . This same phenomenon could be seen in other expanding industries such as with the new mass circulation magazines (eg. Time and Life) and the automobile industry.

However, it is important to note that the roaring twenties was not good to everyone. Many farmers, immigrants and etc. suffered greatly and fell into deep poverty.

Where to find the rich

The 1920’s allowed for the already rich to get richer and the Jekyll Island Club was the perfect place to begin looking if you wanted to find some of these elites. This club was informally known as the millionaires club and it was here that the most affluent names of the 1920’s spent their time – such as the Rockefellers, the Vanderbilts and the Pulitzers. The individuals that were staying at this club (that was said to be ‘most exclusive and inaccessible club in the world’) passed time by playing golf and yachting and basking in eachother’s wealth. A man who played an important role in the uniting of this club was J.P Morgan, one of America’s most cunning businessmen.

The 'billionaire's club'

The Jekyll Island club today

Image left: Traveller.com

Image right: Jekyll.island

The Jekyll Island Club in the early 1900s. Source: jekyllislandhistrory.com

The Morgan Family

The Morgan Family study

The Morgan family is one that well reflects the benefits that the roaring 20’s and preceding years brought to the already wealthy. The way their wealth was constantly and rapidly climbing demonstrates the opulence of these years. J.P Morgan was born on April 17, 1837 into an already wealthy family. His father Junius ran a successful dry goods wholesale business that had been bought for him by his father. Junius educated J.P Morgan about business and at 24 he founded his own firm. This firm became extremely successful and soon he was investing in all kinds of businesses. He was smart with money and after the war ended he began to purchase companies that had fallen into financial trouble during the war. He would buy out several businesses within one area and reorganize them so they had no competition and could operate profitably (Eg. The railroad Industry). Using tactics like this, he became a money giant and was such a powerful force on Wall Street that businesses from all around the country moved to New York to be near his company's financial services.

In March 1913 he died leaving behind a fortune estimated at $68 million. His son J.P Morgan Jr became heir to an estate of more than $50,000,000. J.P Morgan junior continued in his father’s legacy – investing and making money. He lived luxuriously and for him, with all the new products and technologies being created, the 1920’s was the time to be alive. He was a generous philanthropist and in 1924 he donated father’s library (a superb rare book and manuscript collection that included several historically significant pieces, such as the first Bible ever printed in North America) and grounds to set up the Morgan Library & Museum. Living though the roaring 20's allowed the quanitity of money he had to increase at a shocking speed and there were many ways for him to quickly acquire more.

This lifestyle of riches was not only lived by the Morgan family but other high up families as well and other's money was made in similar ways.

Image: J.P Morgan J.R

Source: Biography.com

Image: J.P Morgan

Source: Brittanica

Learn more about creating dynamic, engaging presentations with Prezi