Transcript HISTORIOGRAPHY OF THE WALL STREET CRASH AND THE GREAT

HISTORIOGRAPHY OF THE WALL
STREET CRASH AND THE GREAT
DEPRESSION
Learning Objectives
• Continue to develop understanding of the
reasons for the Wall Street Crash and the
Great Depression
• All students will learn about Keynesian and
Monetarist historiography of the Great
Depression and the Wall Street Crash
• Some students learn about additional
explanations such as those of Bernstein,
Kindelberger and Kennedy
Learning Outcomes
• I will know more about the Wall Street Crash
and the Great Depression
• I can explain the monetarist explanation of the
Wall Street Crash and the Great Depression
• I can explain other interpretations of the
reasons for the Wall Street Crash and the
Great Depression
1. Causes of the Great Depression-the
Keynesian View
• Keynes argued that the government could
stimulate the economy by spending money
• Public works projects
• Taxation
• By spending money the government can
create jobs; workers with jobs created by the
government spend money; this creates more
jobs and so on
2. Causes of the Great Depression-the
Monetarists
• The key monetarist is Milton Friedman
• Monetarists argue control of the money supply is
important
• Failure to control the supply of money in the
economy can create economic depression
• You are head of a bank
• You have one million dollars-how likely are you to
loan money?
• You each have a trillion dollars-how likely are you
to loan money?
Historiography of the Great
Depression
• Read the sources
and use the table
to make notes on
the different
historians and
economists
explanations for
the Great
Depression and
the Wall Street
Crash
EXTENSION:
1. COMPLETE SOURCES 7-9
2. IF YOU FINISH WRITE A
PARAGRAPH ON THE
HISTORIAN YOU MOST AGREE
WITH
3. WRITE A PARAGRAPH ON
WHAT YOU HAVE LEARNED IN
TODAY’S LESSON
Historian Names
FRIEDMAN AND
SCHWARTZ
PETER TEMIN
JIM POWELL
InterpretationMonetarist/Keyn
sian/Other
Summary
MONETARIST
“The Depression, they claimed,
was a result of a drastic
contraction of the currency”
KEYNSIAN
“The New Deal never ended the
Depression because it did not
spend enough”
The government did not
intervene and spend enough
money
“If nothing else had happened
there would have been a
depression because of the severe
monetary contraction”
The Depression was caused by
monetary contraction
MONETARIST
ANTHONY BADGER
KEYNSIAN
FRIEDMAN AND
SCHWARTZ
Key Quotes
MONETARIST
“lack of demand was not offset in
the early years of the Depression
by any compensatory spending”
“the timing of the collapse”
OTHER
OTHER
KENNEDY
OTHER
Government did not spend enough
money to stop the Depression
“the Federal Reserve Board in Washington
came to dominate monetary policy, with
disastrous results”
BERNSTEIN
KINDELBERGER
The Depression was caused by a
failure to control the supply of
money-Fed blamed
“The world economic system was
unstable unless some country
stablised it”
“American banks were
rotten”
Federal Reserve was to blame
with its monetary policy
The timing of the collapse meant
there were no industries to provide
new jobs
The USA failed to provide a world
economic lead-it could have
devalued
American banks were
unregulated and were to blame
Score
(10)
Who am I?
I am one of the original
monetarists. In my book,
The Monetary History of
the United States, I argued
that it was a lack of money
in the system that led to
the Wall Street Crash and
the Great Depression. I
blamed the Federal
Reserve for this
ANSWER: MILTON
FRIEDMAN
Who am I?
In my book ‘Did Monetary Forces
cause the Great Depression’ I
argued that the Great Depression
was caused by the governments
failure to spend money to create
demand in the economy
ANSWER: PETER
TEMIN
Who am I?
In my book ‘The New Deal: The
Depression Years’ I argued that
the Great Depression was caused
by mal-distribution of income and
flaws in the banking system. The
government should have spent
money but didn’t.
ANSWER: ANTHONY
BADGER
Who am I?
I argued the problem was timing.
In 1929, the car industry was no
longer creating new jobs and new
industries like aviation were not
growing fast enough.
ANSWER: MICHAEL
BERNSTEIN
Who am I?
I argued the issue was the failure
of the USA to become the world
economic leader in my book ‘The
World Depression’
ANSWER: CHARLES
KINDELBERGER
Who am I?
The problem was the banks-there
were far too many and they
weren’t regulated. Banks did not
have enough money-they were
undercapitalised
ANSWER: DAVID
KENNEDY
Reflection
Learning Outcomes
I will know more about the Wall
Street Crash and the Great
Depression
I can explain the monetarist
explanation of the Wall Street
Crash and the Great Depression
I can explain other interpretations
of the reasons for the Wall Street
Crash and the Great Depression
Red (not
achieved)
Amber (working Green
towards)
(achieved)