The Great Depression in America social studies lesson for kids

The Great Depression in America social studies lesson for kids -  social studies skills studied in 2nd, 3rd, 4th, 5th grades.

The Great Depression happened in 1929 and it lasts for a whole 10 years. It starts in American on the 24th of October, a day known as Black Thursday. Stock traders sold over 12 million shares in just one day, which was triple the amount that they would normally sell. Over the four days that followed, the price of stock fell 23%. That stock market crash cost $30 billion, in today’s money that would be $396 billion!
The height of the Great Depression was 1933, and by this point unemployment had gone from 3% to 25%. Those who were lucky enough to have a job saw their wages drop 42%! The economy’s output was cut in half, and the government’s leaders panicked, trying to pass tariffs to protect jobs and domestic industries. Because of this, our trade with the world dropped by 65%.
Life during the Depression
Many Americans farms lost their farms, and sadly during the same period of time years of drought and soil erosion resulted in the Midwest’s Dust Bowl, meaning no crops were able to grow. These farmers then turned to California to find work, with many ending up homeless. Many of the unemployed ended up living in shantytowns and they were known as Hoovervilles, this was because the President at the time was Herbert Hoover. Continue reading below>>>

The Cause
What could have caused such a Depression? As it turns out, the banks shoulder a lot of the blame. They were using the wrong monetary policies, like:

• Raising rates and continuing to raise them even as the Great Depression had started.
• When the market crashed, investors traded their dollars in for gold, which caused problems for the dollar.
• In trying to protect the value of the dollar, the interest rates were further raised- which resulted in many businesses going bankrupt.
• To fight deflation, the Fed failed to increase the money supply.
• Investors took their money out of the banks, causing banks to fail, and serious panic which resulted in every day customers also removing their money from the banks, choosing to keep it in their homes. This saw the money supply further reduced.

There wasn’t enough cash money being circulated to kick start the economy, instead the Fed let the supply dwindle by 30%.
What Ended the Great Depression?
Franklin D. Roosevelt became the US President in 1932, and promised that he would create programs to end the depression. In his first 100 days in office he created and signed the New Deal. This made 42 new agencies, which created new jobs, allowed unionization, and provided unemployment insurance. Many of those programs created are still in place today, including the Federal Deposit Insurance Corporation, Social Security, and the Securities and Exchange Commission. These policies helped to safeguard our economy, thus preventing another great depression.
Luckily, the Great Depression has taught us valuable lessons, and a depression of that scale would not and could not happen again in the same way it did then.