On July 8, 1932, the Dow Jones Industrial Average fell to its lowest point during the Great Depression.
This event was symptomatic of a decade of economic uncertainty that was precipitated by the crash in the fall of 1929, when U.S. stock prices declined dramatically. The resulting panic devastated the fortunes of many investors and caused major declines in consumption, industrial production, and employment, which in turn affected the U.S. and world economy for the next ten years.
The U.S. stock market had expanded rapidly during the 1920s, attracting many inexperienced investors. George Mehales, a Greek immigrant who owned a diner in Spartanburg, South Carolina, began investing in the stock market just before the crash. “One day,” he recalled in a Federal Writers’ Project interview:
…one of my customers showed me how much money he was making in the market…It looked good to me, and I bit with what you folks call ‘hook, line and sinker.’…The first day of October in 1929 made me feel like I was rich…During the last days of October, my stocks began to drop. I was gambling on the margin. My brother called me and told me I would have to put up more cash. I went to the bank and put up all the cash I had in the bank with my brother…. I had about five thousand dollars invested. On that day of October 29, they told me I needed more cash to cover up. I couldn’t get it. I was wiped out that day…
“George Mehales,” Spartanburg, South Carolina, R. V. Williams, interviewer, December 1938. American Life Histories: Manuscripts from the Federal Writers’ Project, 1936-1940. Manuscript Division.
Mehales had lost everything, including his restaurant, which he had to sell at a rock bottom price. “I was wiped…I considered killing myself, ’cause I had nothing left.”
After the Crash
In the early 1930s, the United States moved further into economic instability, with the collapse of many banks, dramatically reduced spending on consumer goods, and increasing unemployment.
President Herbert Hoover’s response to these crises disappointed many, including WWI veterans, many of whom found themselves impoverished. They rallied in Washington in 1932, hoping that they might be able to receive their military pension funds early. When Congress rejected their appeals, some members of this so-called, “Bonus Army” reacted with frustration and violence. U.S. Army troops were called in, and the image of U.S Army soldiers confronting the veterans of the Great War in the nation’s capital and virtually running them out of town did not sit well with the public.
The “Dust Bowl”
The United States’ industrial and financial centers were clearly affected by the economic downturn, but so was the nation’s agricultural core. The optimism of agricultural expansion in the 1920s gave way to despair in the Southern Great Plains, where the economy was devastated by bank failures, the drying up of credit, and extreme drought. In 1932, the barren soil was so dry that high winds created dust storms. “Black blizzards” of dirt moved across the region, obscuring the sun and settling in drifts. Unable to sustain themselves, some of the poorest farmers in Oklahoma, Texas, and southwestern Kansas abandoned their homes and farms in search of employment. The promise of a year-round growing season lured many of these so-called “Okies” to California. Eventually, the federal government organized migratory labor camps to assure dust bowl refugees decent living conditions.
The nation’s economy recovered over time, and historians continue to debate the origins of the recovery. Some credit the improvements to the influence of President Franklin D. Roosevelt’s New Deal initiatives—which attempted to stabilize the economy and encourage consumer confidence. These initiatives included the establishment of the Federal Deposit Insurance Corporation (FDIC) and the Securities and Exchange Commission (SEC), the Social Security Act of 1935, and the creation of job opportunities for the unemployed with work relief programs such as the Works Progress Administration. Others believe that the increased industrial production required by preparations for the United States’ entry into World War II fueled the recovery. Whatever the cause, it was clear that by the time that the United States entered World War II its economy had largely recovered.
Find out more about the period leading up to the crash of 1929 in the collection: Prosperity and Thrift: The Coolidge Era and the Consumer Economy, 1921-1929.
Explore the impact of the Great Depression on the lives of ordinary Americans through the work of writers, artists, ethnographers, actors, playwrights, and photographers employed in government work relief programs during the Depression.
- Farm Security Administration/Office of War Information Black and White Negatives offers hundreds of images from the Great Depression/New Deal era including Dorothea Lange’s famous photograph Migrant Mother.
- Read more personal recollections of the Depression Era. Search the collection American Life Histories: Manuscripts from the Federal Writers’ Project, 1936-1940 on the words depression or panic.
- Born in Slavery: Slave Narratives from the Federal Writers’ Project, 1936-1938 contains more than 2,300 first-person accounts of slavery and 500 black-and-white photographs of former slaves. These narratives were collected in the 1930s as part of the Federal Writers’ Project of the Works Progress Administration (WPA).
- WPA Posters consists of 908 boldly colored and graphically diverse original posters produced from 1936 to 1943 as part of Franklin Delano Roosevelt’s New Deal. The posters were designed to publicize health and safety programs; cultural programs including art exhibitions, theatrical, and musical performances; travel and tourism; educational programs; and community activities in seventeen states and the District of Columbia.
- California Gold: Northern California Folk Music in the Thirties is an online version of a New Deal project organized and directed by folk music collector Sidney Robertson Cowell for the Northern California Work Projects Administration. The Ethnographic Experience: Sidney Robertson Cowell in Northern California” reviews the history of the collection.
- Southern Mosaic: The John and Ruby Lomax 1939 Southern States Recording Trip is a multiformat ethnographic field collection that includes nearly 700 sound recordings, as well as fieldnotes, dust jackets, and other manuscripts documenting a three-month, 6,502-mile trip through the southern United States in 1939.
- Florida Folklife from the WPA Collections, 1937-1942 is another multiformat ethnographic collection. It houses sound recordings and manuscript materials made by WPA workers.
- The New Deal Stage: Federal Theatre Project, 1935-1939 holds over 3,000 images of stage and costume designs, still photographs, posters, and scripts. Read the illustrated article “The Play That Electrified Harlem” about Orson Welles’ FTP production of Macbeth.
- “Now What a Time”: Blues, Gospel, and the Fort Valley Music Festivals, 1938-1943 consists of approximately one hundred sound recordings, primarily blues and gospel songs, and related documentation from the folk festival at Fort Valley State College (now Fort Valley State University), Fort Valley, Georgia.
- Voices from the Dust Bowl: the Charles L. Todd and Robert Sonkin Migrant Worker Collection, 1940-1941 contains audio recordings, photographs, manuscript materials, publications, and ephemera generated during two separate documentation trips to migrant work camps supported by the Library of Congress Archive of American Folk Song now the Archive of Folk Culture, American Folklife Center.