Buying on margin was borrowing money to buy stocks! Investors paid as little as 10% of the stock price, borrowing the rest from their broker. If the stock price rose, the investor made huge profits. But if the stock price fell below the loan amount, the broker would issue a "margin call" demanding more money. Many investors could not pay. This practice made the stock market extremely vulnerable. By 1929, over $8.5 billion was borrowed for stock purchases. When the market crashed, margin calls forced massive sell-offs, accelerating the crash. The 1920s also saw rising consumer debt and overproduction of goods, as factories produced more than people could afford to buy. These underlying weaknesses set the stage for the Great Depression.

Black Tuesday was October 29, 1929! On that single day, the Dow Jones Industrial Average fell 12%. The panic had started on October 24 (Black Thursday) when the market dropped 11%. Bankers tried to stabilize the market by buying stocks, but their efforts failed. On Black Monday (October 28), the Dow fell 13%. On Black Tuesday, nearly 16 million shares were traded (a record that stood for nearly 40 years). Ticket tape machines ran hours behind. Thousands of investors jumped from windows (the term "jumpers" became associated with the crash, though most were apocryphal). The crash wiped out billions of dollars of wealth. Although stocks recovered some losses by 1930, the economy was already in a downward spiral. The stock market did not return to pre-crash levels until 1954.

A bank run was a panic withdrawal of deposits! Banks operated on a "fractional reserve" system – they kept only about 10% of deposits as cash, lending out the rest. When rumors spread that a bank was in trouble, depositors rushed to withdraw their money. The bank would quickly run out of cash and have to close. The collapse of the Bank of the United States (December 1930) was the largest bank failure in U.S. history up to that time. By 1933, 9,000 banks had failed. Depositors lost an estimated $1.3 billion (about $20 billion today). President Franklin D. Roosevelt declared a "bank holiday" on March 6, 1933, closing all banks for several days to stop the runs. He then pushed the Emergency Banking Act through Congress, and the FDIC (Federal Deposit Insurance Corporation) was created to insure deposits (initially $2,500, now $250,000).

The Dust Bowl was caused by drought and poor farming practices! After World War I, high wheat prices encouraged farmers to plow millions of acres of native grassland. The Great Plains had not been farmed on this scale before. The drought began in 1930 and lasted through 1936. Without the deep roots of native grasses, the soil could not hold moisture or resist wind. Dust storms, some rising to 10,000 feet, carried topsoil as far east as New York and Washington, D.C. The "Black Sunday" storm (April 14, 1935) was the worst. At least 500,000 Americans were left homeless; 2.5 million migrated from the Plains states. The New Deal created the Soil Conservation Service (now NRCS) to teach farmers sustainable methods, including contour plowing, cover crops, and windbreaks.

Hoovervilles were shantytowns named for President Hoover! People blamed Hoover for failing to end the Depression. The name was an insult – "Hoovervilles," "Hoover blankets" (newspapers used as blankets), "Hoover flags" (empty pockets turned inside out), and "Hoover hogs" (rabbits used for food). The largest Hooverville in New York City's Central Park had hundreds of residents; the police eventually evicted them. Seattle's Hooverville lasted from 1931 to 1941 and had a self-governing community with a mayor and elected council. Most Hoovervilles disappeared during World War II when the war economy created jobs. The Bonus Army (1932) was a group of 43,000 World War I veterans who marched on Washington, D.C., to demand early payment of bonuses. They built a Hooverville near the Capitol. President Hoover ordered the Army to evict them; tanks and cavalry dispersed the veterans, injuring many.

The New Deal was FDR's program! It had three goals: relief (immediate help for the unemployed and poor), recovery (economic recovery), and reform (prevent future depressions). The "First New Deal" (1933-1934) focused on relief and recovery. The "Second New Deal" (1935-1938) focused on reform – including Social Security, the Wagner Act (protecting unions), and the Fair Labor Standards Act (minimum wage, maximum hours). The New Deal created the modern American welfare state. Critics on the right said it went too far (government overreach); critics on the left (like Huey Long) said it did not go far enough (wealth redistribution). FDR was elected four times (1932, 1936, 1940, 1944). The New Deal did not end the Depression – World War II did – but it provided a safety net and transformed the relationship between citizens and government.

The TVA brought electricity to rural areas! Before the TVA, the Tennessee Valley was deeply impoverished. Dams like Norris Dam (completed 1936) and Wilson Dam (existing, expanded) generated electricity. The TVA built power lines into areas private utilities refused to serve. Electricity transformed rural life: electric lights, refrigerators, water pumps, radios, and farm machinery became possible. The TVA also taught farmers about soil conservation, crop rotation, and the use of fertilizer. Critics accused the TVA of socialism. Today, the TVA is the largest public power provider in the United States, serving 10 million people in seven states. The agency also created thousands of jobs during the Depression. The dam construction was done by private contractors, but the TVA owned and operated the dams. The TVA is often cited as the most successful New Deal program.

The Social Security Act created old-age pensions! The first Social Security payments began in 1940. The first recipient was Ida May Fuller of Ludlow, Vermont, who paid $24.75 into the system and received $22.54 per month until she died in 1975 at age 100 – receiving over $22,000 in benefits. The system was deliberately designed to be contributory (workers pay in, benefits are earned) to avoid the stigma of "welfare." Unemployment insurance gave laid-off workers temporary income. ADC (later AFDC, then TANF) provided aid to impoverished families. The Supreme Court upheld Social Security in 1937 (Steward Machine Co. v. Davis). Today, Social Security benefits over 70 million Americans. The Social Security trust fund faces long-term funding challenges as the population ages, but it remains one of the most popular government programs. AARP (originally American Association of Retired Persons) was founded in 1958 to advocate for seniors, partly inspired by Social Security's success.

The WPA was the largest New Deal agency! It employed 8.5 million people. WPA workers were paid between $15 and $90 per month (about $300-$1,800 today). WPA projects included LaGuardia Airport (New York), Camp David (Presidential retreat), the Timberline Lodge (Oregon), and hundreds of schools, courthouses, and post offices. The WPA also produced the "American Guide Series" – guidebooks for every state (still valuable for historians). The Federal Theater Project produced plays, including living newspapers that dramatized current events. The Federal Art Project employed artists like Jackson Pollock and Diego Rivera. Some critics called the WPA "make-work" (creating unnecessary jobs). FDR argued that government had a duty to employ people. The WPA ended in 1943 because wartime unemployment had disappeared. The WPA's legacy is visible today in thousands of buildings, bridges, and art works across America.

World War II ended the Great Depression! U.S. government spending on the war reached $4 trillion in today's dollars. The military drafted 16 million men. Millions more worked in defense factories. The famous "Rosie the Riveter" campaign encouraged women to work in factories. War production factories ran 24 hours a day. Automobile factories retooled to build tanks and aircraft; shipyards built ships in record time (Liberty ships in 42 days). By 1944, unemployment had dropped to 1.2% – the lowest in U.S. history. The war also ended the decade-long stagnation: GDP doubled between 1940 and 1945. Post-war prosperity lasted for decades. After the war, the Servicemen's Readjustment Act of 1944 (GI Bill) sent millions of veterans to college, bought homes, and started businesses, fueling the economic boom of the 1950s. The experience of the Depression shaped the generation that fought the war and built the post-war world.