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After having mortgaged their farms to purchase expensive new equipment to meet the domestic and international demand for farm products during World War I, the sudden decline in demand as countries regained their ability to produce their own food left many American farmers in foreclosure, unable to pay their mortgages.
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The first "talking" movie with synchronized words and pictures was shown by Warner Bros in 1927 and was called The Jazz Singer. The company grew from around 5 million in 1925 to 230 million in 1930, despite one MGM producer's belief that movie "sound [was] a passing fancy."
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The Great Depression began in 1929 due to several factors. The Stock Market crashed, losing $10 billion of investors' funds, but only 3% of Americans had invested in the stock market. However, companies' stock value plummeted, so they laid-off workers and produced less. Without jobs, consumers couldn't afford basic necessities like food and shelter. Many US banks were market investors, had practiced risky lending, and suffered from bank runs, which depleted their cash reserves, so they failed.
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Radios became commercially available until 1920, though Italian scientist Guglielmo Marconi first transmitted a trans-Atlantic wireless message in 1901. They became extremely popular in 1920 and their use spread across the country. By 1930, nearly half of American homes contained a radio. They in turn popularized a genre of dramas called "soap operas," which were created to accommodate the dramatizations soap companies used to advertise their products.
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By 1930, 1,325 of the nation's banks had failed. By 1933, about 9,000 or half the nation's banks had failed. Consumers had lost confidence in the nation's financial sector, panicking after the Stock Market Crash of 1929. They began making "runs" on banks, withdrawing their cash, causing banks to fail because they could not generate revenue from making loans due to the low cash reserves. Poor banking practices (credit overextension, margin stock purchases, etc.,) led to the Great Depression.
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Jane Addams, who fought for women's rights, became the first woman to give a nominating speech at a major convention after she seconded President Theodore Roosevelt as a candidate for the Progressive Party. She also wrote "Newer Ideals of Peace," a book upon which many philosophical pacifists based their beliefs. Her book earned the Nobel Peace Prize in 1931.
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President Hoover believed government aid would "discourage a healthy work ethic," so his response to the Great Depression was a business progressive approach. He believed associationalism (voluntary cooperative organizations dedicated to providing economic assistance and services to those in need) would encourage self-initiative in the needy and self-control in businesses. However, they didn't eventuate after the Great Depression and neither did a second term for the embattled president.
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Newly elected Franklin D. Roosevelt was determined to combat the Great Depression with measures enacted by the federal government, for he supported federal intervention, even if it limited personal freedom and the rights of states. Delivering one of the most famous acceptance speeches on July 1, 1932, Franklin Roosevelt stated, "I pledge you, I pledge myself, to a new deal for the American people." In his first Fireside Chat, his weekly radio broadcast, he explained his New Deal legislation.
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Americans, trained by the Progressive Era to look to the government for solutions, did so during the Great Depression. Hoover, who believed in limited government, asked business leaders to invest in local economies and to keep local workers employed. He also asked Americans to volunteer at charities to assist those in need, but many local charities had limited resources and could give very little weekly support to the needy, so his volunteerism plan failed. He was accused of doing too little.
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Telling Congress that the Great Depression demanded a government response "not as a matter of charity but as a matter of social duty," President Roosevelt's ideals opposed those of President Hoover's, who favored less government intervention. Roosevelt's slew of legislation concentrated on 1) bank reform (Emergency Banking Act of 1933); 2) job creation (Federal Emergency Relief Act); 3) economic regulation (Securities Act of 1933); and 4) regional planning (Tennessee Valley Authority).