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The economic activity from the Roaring Twenties reached its peak.
The economic activity from the Roaring Twenties reached its peak. After that, it started to contract. It was the true start of the Great Depression. That same month, the Federal Reserve raised the discount rate from 5% to 6% to prevent inflation and defend the gold standard. -
Herbert Hoover became president.
Herbert Hoover became president. His laissez-faire economic policies did little to stop the Depression. He believed a free-market economy would allow the forces of capitalism to fix any economic downturn. As a result, he lowered the top income tax rate from 25% to 24%. -
Hoover signed the Smoot-Hawley Tariff Act,
Hoover signed the Smoot-Hawley Tariff Act, which raised taxes on 900 imports. It originally was supposed to help farmers but ended up imposing tariffs on hundreds of other products. Other countries retaliated, setting off a trade war. As a result, international trade began to collapse. A drought hit 23 states from the Mississippi River to the mid-Atlantic region. It was the first of what later was called the Dust Bowl drought, the worst in 300 years. -
The Bank of Tennessee failed.
The Bank of Tennessee failed. This led to the failures of affiliate banks in the next few days. Although the economy was improving, weaknesses in the banking system pulled it back down. -
Food riots broke out in Minneapolis.
Food riots broke out in Minneapolis. The drought continued, hitting eight Southern states the worst. It was the worst drought in the 20th century for Arkansas. -
Hoover signed the Revenue Act of 1932
Hoover signed the Revenue Act of 1932, which increased the top income tax rate to 63%. He wanted to reduce the federal deficit. Hoover believed this also would restore economic confidence. Instead, higher taxes worsened the depression. -
The Federal Emergency Relief Act created more federal jobs.
The Federal Emergency Relief Act created more federal jobs. The Agricultural Adjustment Act paid farmers to limit crops, thus raising prices. The Emergency Farm Mortgage Act provided loans to save farms from foreclosure.The Tennessee Valley Authority Act built power stations in the poorest area in the nation. The Securities Act required companies to educate investors when issuing stocks. -
The government stopped paying dollars with gold.
The government stopped repaying dollars with gold. The Home Owners Loan Corporation refinanced mortgages to prevent foreclosures. The Glass-Steagall Act separated investment banking from retail banking and created the Federal Deposit Insurance Corp. The National Industrial Recovery Act created the Public Works Administration, which added more jobs. -
The Federal Housing Administration provided federal mortgage insurance.
The Federal Housing Administration provided federal mortgage insurance. The Securities and Exchange Commission regulated the stock market. The FCC consolidated all federal regulation of telephone, telegraph, and radio communications. -
Texas experienced record-breaking temperatures of 120 degrees.
Texas experienced record-breaking temperatures of 120 degrees. Throughout the year, the heat wave directly killed 1,693 people. Another 3,500 people drowned while trying to cool off.