Historically High - The Great Depression: USA Edition

Episode Date: July 1, 2026

When you think of the Great Depression, you probably picture frantic guys in three-piece suits yelling on Wall Street as the tickers went wild. But the fuse for the greatest economic crash in history wasn’t lit in New York. It was lit in the wheat fields of the American Midwest during World War I. This week, we are kicking off a massive two-part series on The Great Depression. We start at home in the good ol U.S.A. before heading Global in next week's episode to explore the worldwide impact. We'll discuss how American farmers went on a massive land-and-equipment buying spree to feed a war-torn Europe, only to get trapped in a brutal cycle of debt when the fighting stopped. Then we dive into the bizarre, high-stakes financial triangle that tied Uncle Sam’s wallet directly to Germany, France, and Great Britain—a house of cards built on lending and war repayments that absolutely shattered the lives of millions of everyday people who didn't even know what a stock portfolio was. And the scariest part? The dominoes didn't stop falling at America's borders. We trace the direct, devastating line between the economic chaos triggered right here at home and the financial vacuum in Europe that directly fueled the terrifying rise of Adolf Hitler and the Nazi party. Thanks for listening and don’t forget to hit subscribe, leave a 5-star rating and write a review. You can find us on Apple Podcasts, Spotify, Amazon Music, YouTube, or wherever you get your podcasts. Join us at Patreon.com/HistoricallyHigh and get enrolled for some fun extra content Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

What you're about to hear is part one of a two-part series on the great, I tried to do it. I was trying to do Dan. Did I sound like Dan for a second? You're like, what the hell's going on over there? I thought you were going for like a timeline or current affair type. No, that's how Dan Carlin. That's how he introduces it. It's very classy.

But over here, we're classy and I think we're more approachable than Dan. I feel like when Dan's recording, he's in a sound booth, all he's going. guys is shit in front of him, maybe a glass of water, and he's just ready to go. Also, Dan gets a lot of editing. Dan's not just going. He gets to start and stop and all that stuff. What we're doing is, and in this situation, this could be like five plus hours of doing this, because we're doing it in two parts, but we record it the same time, so the information's fresh. But the Great Depression, man, I know I say this all the time. We don't learn dick about it. about this in high school.

You learned that it happened. You learned that stuff was really bad. This is when you saw the food lines and soup lines, the Hoovervilles, things like that. But then it's just like, and then it sucked for well in World War II happened. There is so much tying. The period of World War I, all the way through the end of World War II, is just one period of time in which everything is just causing itself. Everything is connected. And it's all for some reason.

and come up for kind of debate. Because in doing this episode and going through a lot of different varying sources, there are some people that kind of sweeten up Hoover's approach to the Great Depression. And there's some people that are naysayers towards Roosevelt. And he does, you know, some of his New Deal stuff does end up being struck down by the Supreme Court for not, not, uh, being lawful. But at the same time, there really wasn't an answer that jumped out off of the page because there was so much denial in the 1920s in the post, this interwar period of,

well, yeah, we had a bit of an economic boom coming off of World War I. Agriculture starts to slip by the wayside as the world market comes back on to line. Yeah. And you also have this against the backdrop of prohibition and everything else that's going on. Getting ready to come up to the greatest ecological disaster in United States history with the Dust Bowl. We've covered before this. We have been playing just the tip and feeling on the outside of the pants with the Great Depression through several episodes. We did the Dust Bowl. We did Prohibition. We did Al Capone. This is Depression era. gangsters. This is Bonnie and Clyde. This is machine gun. Kelt. Like all of this fits within the same timeline of like a 20 to 25 year period where coming off of World War I, we're jacked up.

We're like, fuck yes. We feel like everything is booming because again, we went on war footing for that. We were making money. Employment was great. And you just feel like you can't lose at that. point. Everything was going in the right direction and because everything was going in the right direction, there weren't really need guardrails or anything preventing like a backslide. It's, to use an example that we were just talking about before the episode, it wasn't illegal to mate with an animal until the first time somebody got caught and somebody said that's not right. Yeah. A lot of what's going on during this point in time is a lot of, of open space.

It's first timers. Hey, I'm new. This is a new way of doing shit. And although we've had so many panics inside of the country, we'll talk about just the numbers leading up into the Great Depression, so many different episodes of economic strife. And they've all kind of been built around similar things. And the responses to them sometimes are fast, sometimes are slow.

There was a great depression in the 1830s. And then we got this one, and they decided to back off that and start calling it just a long depression. Yeah, we've had a great one. All right. I'm Chris. That's Adams. We're going to be your professors today.

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But we like climbing up the charts. We love seeing just how high you guys can take us while we're high. That's right. All right. And without further ado, let's get real depressing in here. So I guess without really spoiling it for anyone, the Great Depression was basically the longest, most severe economic downtime in modern history. Last from about 1929, when they officially started as the Great Depression, the lead up to it is a decade before. Begins technically with the Wall Street crash, Black Tuesday, and caused not just, again, very insular, the way we learn about stuff here in the state.

States. It's all about us. So when we learn about this, it happens in New York. You hear about stockbrokers. We didn't learn anything about how it affected like people out in rural areas that never even had money in stocks or anything like that. And barely heard a peep about what the global impact of this whole thing was. For the two-parter, this is going to be part one. We're selfish. So again, it's going to be all about us for part one. And then we're going to talk about the global impact and how that had this insane cost. cause and effect and pretty much why World War II happened.

The United States has to be part one. It has to be part one solely based upon the fact that... It's our fault? Yeah. It's our fucking fault. That's the reason why the United States... We have to take the blame. Exactly. And the United States has been no stranger to economic instability.

From 1792 to 1907, the United States had 13 different episodes of what they called economic panic, which I'm assuming was because of the fact that, the study of economics probably wasn't huge, that they just realized, hey, this scares me when I look at the numbers. Well, shit, man, look at it this way.

You said 1792. 1792 was the first one out there, right? 1776. So how many years is that before? Maybe 20, not even 20? That's 16 years. So 16 years. We've just moved out and everything.

We're like, we're going to make it on our own mom and dad. and 16 years later we're like shit shit shit we don't have an idea what to do for financing do you think there's any way that give us an allowance back no fuck we're on our own 1792 1797 1819 that's like the biggest run up here

between 1797 and 1819 because then we go 1837 1837 1847 1857 the consistency is beautiful there it had to have been we'll deal with this in a decade it's a cyclical decade Uh-huh. 1869. Post, I mean, post-Civil War, there was probably some economic strain there. 1873.

That was the one that was originally known colloquially as the Great Depression until 1930, or 1930 happened. They go, okay, we'll just call it the Long Depression. Well, you realize that it wasn't called World War. It was called the Great War before it was called World War I because then the second one happened. They're like, shit. 1884, 1890, 1893, 1896, and 1907. And a lot of these, when you're talking about something like 1890, 1893, 1896, this is because whatever measures that they threw at the panic were working to a certain extent,

and then something else went wrong. And when we talk about all 13 of these episodes, these are based on speculation. This is based on land speculation, cattle speculation. Basically what that means is the overvaluing of an asset. to where so much money is thrown at it that when the ass falls out of it, there's a bunch of people left holding stock that it's worth way more than it should have asked.

Speculation is a fancy word for guess. Yeah, and it's in the realm of like short-term investment. No, like that's something. Hold on. No, no, no. I feel like it's more an exact, it's, they're so intertwined.

Speculation is what I would tell my kid if I was trying to tell him, I'm taking a guess at something. Oh, like the general definition. Yeah, just so I can avoid an argument because he doesn't understand the word. Yeah, it's long enough. There's enough syllables in it. There's a you in it.

It's going to be confusing. You also have a situation where there's other kind of the United States dipping their toes into foreign investments in places like Chile and everywhere that's kind of gaining a foothold down in South America. And then when they go tits up, all the money that we've invested there doesn't come back, which again shrinks our economy because there's less money. to go around. After the 19, or after, yeah, after the 1907 panic, economists were like, fuck this, we have to figure this out. We're just going to go about adopting the terms recession and depression. And a recession is just as defined a significant or prolonged down term in economic activity.

This is kind of off topic. But when you're mentioning, like, we did investments and stuff like down in Chile and stuff, that was our colonial. That was us trying to do the colonizing thing like we did after. And we were like, now that we're over here, we talk about Banana Wars. Now that we're over here, we'll just go ahead and protect all of the whole Caribbean and South America. If it's in America, the newest America is going to handle business for it. Talk about a terrible idea to try to colonize and invest in like the furthest country south of us in South America.

It's the only place that we could get probably a foothold enough in to what we could try to claim territory. It's true. Have you ever looked at Chile on a map? Really skinny one. down the whole entire west coast. It's a, yeah, it's a creepy looking country. It's very, like, as far as solid landmass, the way I understand it, it's very thin, but then it's just so many islands that's like that, which is also why it was so crazy.

I thought Chile would be much higher on the game show when we talked about. How many islands? And something was more than Chile, but when you look at it, it looks like it's all just, all right, getting back to this topic. Yeah, so recession, a significant or in prolonged down term, in economic activity, typically lasting more than a few months. Depression as defined,

we're going to do as definitions just to kind of get everybody up to the words we're going to be using. It's not that we think that you're dumb. I actually had to look these up to just fully understand what they mean. Honestly, this could also be like another meaning. It could be a little double entendre

because everyone was just depressed as fuck during this period. That's, yeah, those are definitely how they got their names. They weren't economic terms. It's like, well, how long did, what was the amount? motion that we felt during this span of time. Sadness. I was depressed. Yeah.

It's shocking we don't have sadness. We have bummers. Like just short, week-long blips. It's a real hard bummer in the country's period or in the country's history. Depression is an extreme and sustained economic downturn is characterized by massive job

layoffs, widespread business failures, and a severe drop in GDP that often persist for years. GDP is just the total monetary value of all final goods and services that are produced within a country's borders during a specific period. It's a pretty good measure of your economic growth. If your GDP's going up, there's going to be a lot of money in the coffers to start spending. Into World War I,

it's a situation where we, again, play both sides of the fence before we really commit our chips and put them down on the table. We are selling to Germany. We're selling to Britain. We're kind of playing both sides of this thing until it comes down to putting our men on the ground. So to sum it up, because we're going to also be covering this during the global portion of it, but so much of this is caused by World War I that we have to explain what was going on in the states and how that affected it. So European agriculture is just basically collapsing because of the millions of farmers that were sent to the front lines for World War I. So to feed the Allies, American farmers basically had to

like heavily mechanize their operations to spend a lot of money get loans and everything for tractors things that would allow them to maximize like the land that they had and maximize crop yields because so much of it was going out of the country over to Europe like you said

not just to the Allies to begin with it was whoever was going to be paying for that in the start so the US government basically guaranteed these farmers hey there's going to be so much need for this. Keep growing it. Grow as much

of it as you possibly can. And prompted them to take out these massive bank loans to buy more land and then also in turn, like you said, more mechanized stuff to be able to, workers to be able to actually work the land itself. Well, we talked about that during the Dust Bowl episode, it was you have X amount of land

that you can make a sustained amount of money on. But if you double down, this is always sunny buying two weeks in a timeshare. You sell the second week of the time share, it pays for the first week. You go out, you leverage a ton of cash to go out and buy a new tractor and to buy another plot of land. If there's a guaranteed price that's going to be coming in a grain that you can turn in

a bushel and there's a minimum that you're going to get for it that's going to be profitable, it's great. It's great. You're doubling your profits all the time. The government's also prompting you to do this and you're like, well, who knows better than all of the economists, then know who's going to be buying this stuff. Well, once World War I ends, these European farms recover like in the 20s, the global market basically is like, yeah, all this stuff that you've

been selling and expanding, we don't need it because we're able to support ourselves and be more self-sustaining over in Europe. So you get all of these crop prices that just completely crater. There's no demand. There's an insanely high supply of it. And American farmers were unable to actually pay off the wartime debts because it was a shorter war. Like I'm not saying the war should have gone longer, but when it's one of those things where they didn't anticipate the recovery of Europe maybe happening so quickly. It becomes an issue because it's not trying to go in and rebuild a city.

It's just them going out and planting seed and being able to harvest to get them back up and running, which in a sense, the agricultural industry, that's awesome. It's nice that you don't have to go through and rebuild infrastructure and put in plumbing and all this different. stuff. You can just kind of go out. You can hoe your rose again. You can plant your seeds. Waters coming. Harvest to market. So correct me in my line of thinking here. This whole thing, with them being unable to go ahead and repay those wartime debts, that forces all of these hundreds of small like country banks to close long before 1929, long before the officials started the Great Depression.

Well, a big part of this. Well, hold on. I'm getting to the point where I kind of want to see if I'm understanding this correctly. This was at a time when banks themselves were literally just banks. FDIC is not a thing. This is going to come out of this. But what I'm saying is that these banks are almost

privately funded things because they're not government-owned entities. And banks only have a certain supply of money. Now how banks get money is they have to accept customer deposits and then they then use that money to loan out for people getting loans

and then get those repayments back in the interest in the hope that there's never more than 10% I think is the number of people withdrawing all their money out at one time. They have to hold a certain amount of money in reserve for the percentage of customers that would come in and pull out. So this is literally situations where the banks just simply run out of money because the farmers that they've planned on having these payments come in

no longer do because they can't sell their crops to make any money. And because that money's gone, all the people that have actually deposited their money, there's no money to give them. So people just simply, the money's gone. Well, sir, I'm sorry, we were expecting these payments to come back. Imagine, like, people didn't know that, right?

like when you're going to deposit your money in the bank are they telling you hey just so you know this money will not always be on hand for you because it will be loaned out so when you go in there and you say I need to get my money on the like we don't have any money and you're like I very certainly you know do have money here I'd like which I'm like no what you're not understanding

is that we don't have money like you're the bank this is where like the money is and having to explain that to person after person, like if you were a bank man, God, fuck, I wish I would have looked at how any bank managers died during this period. Died or were killed? No, no, that's what I mean.

I'm assuming killed is probably... I'm not saying deservingly so, but what I'm saying is like, that is how it worked, right? Yeah, and a lot of that is happening because as you're talking about, there's no... We'll get into talking about it

very quickly here, but there's no overarching kind of grouping that's holding these banks together. Most of the time, states are getting involved. But in the grand scheme of things, if you're living in New York City, Detroit, anywhere, these big cities of industry during this time, and a bank in Dubuque, Iowa fails, do you give a fuck? No, no, no, because nobody knows. Yeah. It was just a bank in Dubuque.

And it was only those, even if it was a hundred of people in Dubuque that were funding that bank or whatever. It's just 100 people at that point. And it's rural people. This is the illusion of two Americas during this period. It was the roaring 20s that was happening more so in the cities. And then it was almost the ruining of like urban or not, sorry, the ruining of rural America where all of these huge farms are just individually just kind of being snuffed out. and everything. And so new technology, you know, you have automobiles, radios, electricity, creates all of these factories and this massive wealth for corporations, urban workers.

And then that high prosperity, when you're in Washington and you're like someone in the government and you're representative from New York or anything like that, you're like, New York's fucking booming. You should see what's happening in New York. Like, Broadway is cranking out. People are spending money. Like, it's nuts. like the stock market's going wild. I don't even know how to explain stocks, but they're going nuts. No,

that's what people are basing how we're doing. Like you said, they're not basing it on how people in Dubuque are doing. So when they see all of this stuff going on, these cities and just this like society of spending, they just are assuming that everything is going well across the country. But it's almost like rotting from the inside out. It's rotting and then it's going to have to spread to the coast

and then that's when it's going to like wake up. up some people. This is, as you're saying that, I mean, the 20s, this happening in the 20s, is this not like

the most reflective part of life? Like this is happening in the 20s. Think back to our 20s. Think back to all of the things that you really cared about.

Like, your time from like 18 to 25, I think we both had houses kind of later on there, so we had a little bit of responsibility. But there's such a certain amount

of time. that you don't really care about, I mean, you're paying your rent, you're paying your bills, you might pay the light bill a day or too late because you forgot, but you're always going to go out and party and have a good time. None of those bills or anything, any of the money that's coming due is ever going to hold you or restrict you from going out and having a good time. Also imagine people coming back from the war and me like, I survive that. I'm going to live it up for as long as I can because I don't know what I'm like there had to have been a lot of that mentality of like let's be thankful I got home let's fucking go do you want to go to a bar in 1922 yeah that sounds awesome you can't you have to go to a speakeasy because alcohol there's a prohibition going on and a lot of these speakeas that these people went to weren't like the cheers variety of going in and sitting down at the bar and having a guy pour you beer and you talk about your problems they're wild they're parties yeah everybody's dressed up, everybody's having fun, you have loud

music going on, it's a pretty carefree environment. Yeah. And while this carefree environment is going on, you have agriculture industries that need to be propped up by the United States. And we talked about this during the Dust Bowl episode. The economic health of the country was

separate and there's an agricultural depression off of the heels of this giant boom during World War 1. You have subsequent protectionism of wheat prices with the wheat Price Guarantee Act of 1919, which Woodrow sets a minimum grain price at $2.26 per bundle for 1919 and 1920.

Well, that's awesome, because you just bought us two more years of being able to pay off a 15-year loan that we have. But years three through 15 aren't going to be guaranteed. They were in such a situation growing crops to where their crop rotations were so poor that there were other industries that they probably could have planted in and made more money. Those crops required more water.

They required a different composition of soil in some areas. They required a different climate. What was the whole point of growing wheat in the Dust Bowl areas? Because that was the thing. It was the easiest, fastest thing that you could... And it was the thing that required the least amount of water because there wasn't a ton.

It was all based upon... Remember the years in the rain and they would get their bumper crops and stuff like that. It was all based on that. the water was outside of your control and wheat was the thing you could grow. Yeah. So after you roll through 1919 and 1920 and this act ends, the next solution is, well, we're going to throw tariffs up in 1921 and 22 to block the importation of all of this cheaper foreign wheat that was lost during World War I that helped us gain this foothold because that's going to undercut the farmer prices.

well then you have these poor crops, poor crop years, and these rural banks, mostly in line with these state banking rules, start to fall apart. These situations where, and I still think that it's the most insane thing, I don't know if it's just because I learned this later in life, just how banks worked, but the fact that you just go deposit your money and then they're like, cool, now we have X amount that we're able to, loan out or to invest.

Your money just doesn't like sit in the computer or sit in the vault. That money is immediately spread out to every other industry. That's what I was saying is that is insane. So when we're saying these banks are closing, what we're actually saying is the banks spent up and didn't get back their customers money. So every person that had their money with that bank has now lost their, lost their shit. even to think like a bank will take your money and invest it in the stock market. And then when there are gains, your money is never returned.

It's just going to be available to you. This was at a time when fucking banks could use your money for this. Like how insane is that to think that there was a time when it's just like, so your money is either being used for a gamble or a loan? And there's a... Which are gambols kind of in themselves in some ways. And in some of these rural parts of the country, how wild is it that you're like you have a bank that you have a bank account in and then that same bank is the one that loans you the money for your land so in a way in a sense you're kind of getting money from your own checking account to fund portion of your yeah they could be they could be going over to your box and using your money to pull out and that was probably an ironic an ironic thing that they did I'm guessing they're like you're gonna actually we're gonna be pulling your money out to pay for your loan and you're like wait what the fuck you're talking about explain that to me

you think there was ever a situation where somebody walked in to pull their money out and they told them there was no money and they said why and they said because you can't pay off your loan to us? Like if you had been able to pay your loan, that we would have the money in the bank account to be able to give you your money. Well, shit, dude. And think about this too. Like imagine that you're in an area and you just make like a brand new purchase of like a tractor and everyone. like, fuck, dude, like, that's awesome. And then the bank closes like a week later, and everyone knows you got a loan from the bank. And then when they're explained it, they're like, dude, was that our money,

technically that they gave you to buy that fucking tractor? Have you been making your payments on said tractor? Oh, no, you haven't because you haven't been able to produce a crop to get any money to pay that off. Yeah. Okay, so you're the reason I don't have any money in my bank account. They're victims of a system that was set up so haphazardly without any guardrails that this is going on.

Along with all this, the wealth inequality just balloons. The middle class, who is most affected by the stock market crash, because they... Not because they fucking have stocks. Well, I think they said there were somewhere between two to ten percent of families in the middle class of the United States own stocks. That's what I'm saying. So not very much, but at the same time, it was more. than it had been in the past.

And this is a situation where if you're super rich, if you have a, if you have $30 million in your bank account and you lose $22 million in your bank account, guess what? You still have $8 million in your bank account. If you're poor on the other end of the spectrum, you don't have any money, you struggle to get by, everything goes wrong, you still don't have any money, you're still struggling to get by, it just becomes a little bit harder because now there's more people in your shoes. Yeah. the middle class is sitting in this area where they have enough money to be able to start reaching out into the stock market, into the rich man's game, because they're seeing the stock market just balloon, just absolutely blow up.

And as that's happening, middle class is thinking, well, I would like some of that too. Well, a very small portion. I know I keep, sorry, not trying to interrupt you. No, you're good. it's so crazy to think that like people that had never even bought stocks or talked about stocks or really knew how stocks worked are the largest proportionate percentage of people that were affected by this yeah and it's it's a situation where the middle class is already locked into basically uh a lone culture because as you were talking about with the automobile with the radios, with the improvements on houses, you're buying that on loan. You're putting a certain amount down and then you get the rest of it loaned out. At this point in time, you would get an auto loan for your Ford Model T, Model A, what have you.

Your interest rate was going to average 16%. That's not saying that everybody got 16%. Some people were in there for 30%. Some people were in there for 10%. 16% for a car loan sounds insane. Yeah. Also, you're looking to put 35% of that down in your loan term very rarely stretched beyond 12 months. That's a lot of money to pay back very quickly.

But at the same time, if you have a job, if you have a family, you are in a situation where you are able to make the payments, you're able to get by, and you don't have to listen to your kids talk about. about how they went over to their friend's house and listened to their favorite radio program, and they want to listen to the radio program at home. Well, and if you're paying it off over just the course of year, I know 16% is insane, but then you're able to justify that and say, well, I guess I'm going to only be 12 months. Yeah. Yeah, this is only going to hurt me for 12 months. I'll make it through.

Yeah, as opposed to, oh, it's a 10-year loan at 16%. Oh, shit. There's this introduction, this massive introduction of the middle class to stock speculation. And the reason why the middle class is catching on to this is because from 1925 to 1929, the Dow Jones, which is a grouping of stocks, the Dow Jones Industrial average grew roughly 143%. So it was right in the range 1925 of 156.6 points, September 3rd, which was the record high in 1929, it had 381.1 points. that's a massive growth. And you are throwing as much money into this as you can spare, basically, to try to get this in this grouping of families.

But there's a better way. Because if you only have $100 to invest, but you could have $1,000 to invest, you're going to make so much more. You're going to make 10 times more money, right? This is where we get into, man. Oh, buying on margin. I don't know why my brain just shot up there. Buying on margin is a situation where you're going to have to put a certain amount down.

So these speculators that are looking for three, six months average, seeing these stocks go up 30 cents a share. You put 10% down. A brokerage firm is going to lend you the other 90%. Whatever gains you make on that, you use to pay back the 90%. You own everything else free and clear. So, yeah, so the way it was explained is I have $10, but I want to invest and buy $100 worth of stock. They lend me the other $90. So I owe them 90 plus a little bit extra.

my anticipation is that it's going to go up and then I can sell it when I have $110 or when I have $120 and then I pay them back their 90 plus interest and I then keep that whatever is left over. Yeah, you're using dividends, whatever you need to do to clear that. But that's if it goes up. Now, if it starts going down, what that brokerage is going to do is they're going to call me when that thing hits, when my $100 in value of stock. hits $90 and they're about to lose any money on that investment, they're going to call me up and say, hey, we need you to pay that money back now. And if I can't pay that money back,

instead of the stock, them taking losses, they are then going to say, well, part of our agreement on this borrowing on margin or buying on margin is that we can take it back if you're unable to repay it. So we're going to take back those stocks. We're then going to sell them now while they're still worth this and we can try to get our money back.

So you are out that money. And you're still making up the difference. You had a margin call that you were just talking about, which requires you just making up the difference, balancing the account by selling off other assets to get you back in that range. And then the severe drop that you're talking about is when all of your original cash investment is even gone at this point in time, you're just required to pay off the loan from the broker regardless.

And if you can't pay off that loan from the broker, everything else that's in your investment portfolio is put up as collateral. If you have nothing left in that, then they come after your house or whatever assets you have. So it's a great game if you're making money. It's a horrendous game if the market falls apart. And this is at a time when I believe it was the Federal Reserve was loaning out money at a 5% interest rate. And a lot of these banks and brokerage firms were,

handing out money at like a 10 to 15% interest rate. Well, and if so, we've covered loans. What are we missing at this point? We're missing credit, right? Yep. So this sees kind of the introduction of the credit system and... Not cards. Not cards.

Just borrowing it being allowed, you know, a system of credit. When the post-war economy, that's going to eventually cool off. It's going to spread a little bit from the rural areas into the cities. But when that began to slow down kind of the mid-1920s because they couldn't afford new goods. Businesses didn't lower production. They basically invented a workaround. And it was called installment buying. Buy now, pay later.

And during the 20s, the consumer culture kind of underwent like this behavioral shift because prior to World War I, buying on credit was like this personal failure. It was like, oh, you don't have enough money to buy it outright. It was like you had to borrow that. It was the same thing as just trying to have to borrow money for it. And the 20s completely flipped the script and had this invention, again, of installment buying. So for the first time, regular people just bought cars. They bought appliances. They bought furniture.

And this is when families are just getting started as well because people are coming home from the war and starting families. By the late 20s, over 60% of cars and up to 80% of radio. and furniture were bought on installment plans. So... It's a lot. Yeah. So what this actually does, though, is there have to be signs that the economy is slowing down. This gave this illusion to all the sales and factories and everything like that, that people were still spending and spending and spending.

But because this installment buying thing was new, there wasn't this awareness of like, yeah, but they're getting this stuff and we're still having to build. this stuff, but they've only paid a little bit of it back. We're not getting, we're sending out the product, we're not getting as much money coming in, because it's going to be over time. And then we're going to get more money in, because there's going to be interest and shit. It artificial keeps the factories running,

gives the illusion of this huge booming economy, but it's all built on a mountain of consumer debt. And by 1929, people had just hit their limits. And when they hit their limits, and like, you know, in every fucking 90s movie, when they got the credit card bill,

they're like, whoa, what? They just stopped buying, and the entire system just grinds to a screeching halt because you have all this infant story, all the factories still wound up,

and all of a sudden stuff starts to stack up because no one's buying shit. So you're losing money also for a period of time there when you're still in full go mode and people are like, nah. Well, and it's super important too,

that you make sure to, I guess, give these industries a pep talk. It's never important to face reality and maybe reach out as a government to these companies and say, hey, we're seeing the consumer debt numbers in this country and it's kind of scary. There's no oversight.

No. None whatsoever. This whole thing causes the invention of federal spending oversight for this kind of stuff because the government's just looking around being like, A lot of new cars on the road. Booming economy.

Yep. And because these people are driving around, no one looks homeless yet. They're again in the population, in the city centers, so they're not feeling it. Yeah, they have some people in the Senate coming in being like, so a bunch of little banks are closing in the Midwest, but those people, what's their representation like? None. You don't have anybody in government that's banging the drum because everybody's seeing the same shit. And if you're really talking about one of these situations, if somebody will use Dubuque again, we'll use Iowa as a whole. If you have a center from Iowa- Sorry, Dubupe.

Yeah. It's your turn. If you have a senator- Is real place? Yeah. Okay. If you have a senator from Iowa that's coming into Congress and saying, hey, my industry in Iowa is messed up. It's just not going well. and they look at the population of Iowa

and they think, well, okay, it's 700,000 people, whatever. New York, how are you guys doing? Classy. New York City is running great. All of our factories are pumping everything out. Michigan, you guys, good over there. Detroit is rolling. They're going to look at Iowa.

Yeah, they're going to look at Iowa and say, well, that sounds kind of like your problem. They're looking around, and at this point, it's like the rural states or the guys with like the holes in their jeans and stuff like that. But everyone else is just like, it's just flashy because there's still all of their states and cities are still making money. Well, along with the government just completely neglecting this, rich people are having a field day. They love market participation. They love new investors in the stock market because all they have to do, J.P. Morgan, if he's,

He was alive at this point, I'm sure he probably was, has to go on the radio and say, this stock is going to go through the roof. He was because they put him on trial. He had to go in front of Congress. Yeah, I mean, so this manufacturer is going crazy. RCA, whatever it was. RCA stock is valued at this price. It's actually a steel right now because they have XX and X that are about to come out.

In the general market, the people that aren't in the know are like, okay, RCA. Turns out J.P. Morgan, whoever it was that came out and gassed them up, had a ton of stock in RCA. You see RCA's market price jump like crazy. Artificial inflation.

All of a sudden, JP or whoever it is, sells their stocks at an all-time high. You see the number go down. If that number goes down where it was previously to where you bought it and you bought it on margin, you're going to have a hell of a lot of problems. And all you can do at this point

is it's like a sick. comm mob being like JP and then he's just like because no one there's nothing in existence that's like a regulating agency or anything like that. Do you have anything before

the Dawes planned? Yeah. Wasn't Dawes after? Well, the Dawes plan was in 1924 and I know we're kind of like time for you. No, go ahead. So the Dawes plan and this is going to jump kind of international for a second.

So the international debt crisis from World War I was basically this ticking time bomb. Now, American banks, again, think of the banking system. Me and Adam has described it, where it's literally the money going into the bank and the cash has to be there and it's being spent on loans. In other words, rock solid. Yep. So all of these international, these countries are borrowing from big American banks for like reconstruction and everything. So in 1924, the U.S. implements what's called the DAWS plan, which restructured Germany's war reparations that were dictated by the Treaty of Versailles and flooded Germany with American private bank loans. So there's basically taking a bunch of money from the banks that is just the deposits from Americans and it's just like sending it over to Europe.

Those payments basically were like, okay, Germany, think of it in a cartoonly way. So the Americans are handing a briefcase of money to the Germans. The Germans are then turning and taking half the money and giving it to a guy wearing a British lapel and a guy wearing a French lapel and is dividing that up for their reparations. And then Britain and France both then walk back over to the American lender and start paying back their wartime debt for all of the supplies and all of the fucking food and all of that kind of stuff. So there's this three-way, four-way international ticking time bomb because all of this money has been flooding into Europe. And the temporary injection of cash that was happening at this time kept Europe alive for like five years, kept them afloat. And basically delaying like the global collapse until Wall Street itself ran out of money to lend. You might know more about this.

You probably looked into this. Maybe you didn't because this feels like an odd question. How do you think they did that back then? Because I want to say it was like $860 million that was given to Germany. Is that a boat full of... It's still the time when the gold standard was backing the currency. Yeah. So it would be essentially used in some type of way that was an internationally recognized

because, again, Europe was on the gold standard as well. So there would have to be some type of like... Yeah. Which, God, that's insane. Okay, mark that down for an episode. is just as trying to figure out how the gold standard was established and how it internationally worked with like currency.

Well, we'll get into it in this a little bit. But as far as... Not a happy way. No. But as far as like that transfer of money, is that pallets of gold, cash, what have you that way? Or is that just numbers on a ledger

at that point in time? Because now it's all computer bank transfer type shit in that regard. It's money on a ledger. There were, I mean, you made copies. of them. Like if people are doing contracts and signing stuff, you have, you're signing 15 different copies of things. You have five different ledgers of the exact same thing for backups. I was thinking about this for the credit stuff. When a bank closed down or something like that, imagine a small town

bank doesn't close down, but it burns down. Where's the backups? Like, what's the record keeping? Like, is all our debt just gone? Well, your money's gone too. Is the debt gone as well? Yeah. Like, no, we actually kept the debt ledgers in another location. Am I off the hook for my loan if you guys burned down? Your cash is just gone down. I just imagine that everything back then, it had to have been ledgers like we're talking about. Could you imagine if every major multinational agreement where there was money that exchanged

hands was just like a drug deal, just like 50 guys with briefcases that walk up and hand them over to the other side? Like if it was just physical transfer of cash or assets or anything like that, it would be so weird, but it was just a computer transfer via pen and paper, probably, right? Where are we at, time frame-wise?

We're getting close to 1929. Okay, I got a couple things just before that. Okay. So, by like 1927, investors, like the smart ones, the ones that had the information, not your basic, probably 90%, 95% of them,

realized that that slow burn and that kind of slowing down of like with the credit and everything was real. And corporate profits started to kind of flatten out. Construction was actually slowing down for stuff. And then, of course, they know that consumers are maxing their asses out on debt. There's not going to be any money to back that up. So instead of like pulling their money out, what they would do is they would shift their cash away from like real actual production, like building factories, tangible things like that.

They would actually create jobs, things of that nature. and they just poured it into the stock market because they had been making money off of it or saw people making money off of it so why aren't they just doing it in that sense? So what this does is because there's these huge influxes it creates this massive like speculative bubble because all of a sudden people are seeing this go up

and the stock market grew completely detached from the actual economic reality. It's just kept going up and finally skyrockets between like 1927 and 1929, while the actual foundation of the economy was basically just made of fucking tissue paper. Well, that's just it. It's a completely separate entity.

So it's, they, the two have literally nothing to do with each other because... They were so disassociated from each other. It was just like, in, in the heart of the country, in the rural areas, people were fucking had nothing. And in the cities, it was, Life can never get better. You have a stock market that's built on hopes and dreams, and you have an economy that's centered in reality.

And the two you pray will never meet, but at the same time, it's always going to come do. The bill is always going to come do on this stuff. And is we were, are you into 1929? Just about. Okay. So also in 27 and 28. several like prominent economists, a bunch of financial journalists, even members of like the Federal Reserve

soundly blew the whistle on like what was underneath the actual, the visible economy, basically. There was this guy named Roger Babson that gave repeated public speeches, a warning that this financial crash was imminent. In 28, he explicitly said he goes, a crash is coming, and it may be a terrific one. and Wall Street just completely dismissed him. They said that his prediction was labeled as the Babson break. They thought he had finally just gone nuts or kind of crazy. This guy, Adolf Miller, unfortunate first name, was a member of the Federal Reserve Board and was criticizing like the central bank's policy of keeping interest rates low to continue to have people borrowing and things like that when they didn't have the money to back it up,

basically telling them they're like, you realize that this is just continuing to feel. fuel like this stock speculation that's insanely out of touch with reality instead of helping like productive businesses all the money is going into fantasy land of the stocks instead of like tangible like things that people are going to live off of um by early night instead of buying the goods that are sitting on the shelves it's nfts it's fucking nfts is what it is instead of just buying reality and being able to take something home you're going to invest reality in or you're going to invest your money in something that is maybe the same company, but instead of buying their products, you're going to buy into their business. It's a who's a what's it? It's very dust.

In early 28 Federal Reserve Bank of New York actually tried to raise the interest rates just to kind to cool the stock market, basically just to try to put the brakes on it a little bit. But the speculative, the momentum was apparently already too strong. Dude, if you're making money, what is interest? You're shouting into the ether at that point. And the board lacked the political will to like actually enforce any strict regulations. Because guess what? There were hardly any to begin with. Again, this is like, when things are going good, shut your mouth and don't question.

It is basically kind of the motto of the day at that point. And then the mid-1928 official government data showed that housing construction had peaked and then begun to sharply go down. Steel production was declining because again, they're not having to build anything for the war effort. aren't buying a lot of stuff. And then the automobile sales were starting to kind of flatten out. The broader economic foundation was cracking. Well, it was cracked as shit and it was starting to crumble at that point. But the warnings were again entirely drowned out by the daily news of that fucking ticker about sell, sell, sell, sell, buy, buy, all that kind of stuff where there is, again, two completely different realities of what's going on and what the perception is of just like

pop and champagne and guys in furjack is just going like and mommy mommy I'm so hungry in the rest of the country just to put this into a little bit of perspective here 1928 the year we're talking about approximately 3.6 foreclosures per every 1,000 mortgages the default was less than a half a percent 1928

we're going to talk about a number in 1933 that is going to shock you kind of rolling into 1929 the stock market as Chris was just explaining it's it's so overinflated it's Barry Bond's head towards the end of his career overinflated and no one's hitting any warnings there's some economists that are coming out as you were talking about that are saying hey this is some bad shit Then there's other economists that are saying, but I'm heavily invested in the stock market and I'm making money. The last thing I would want to do is face reality

and tell everybody that's bumping up my stock prices that this is probably bad. At that point in time, if you have two varying degrees of this is good, this is bad, what's the large public going to do? Well, I don't know. So I'm just going to keep going on what my gut is telling me. Well, and this is at time, too,

when communication is in, remotely what it is today where people are sounding the alarm in Congress, but that's not getting anywhere outside the halls of Congress to where it's getting to like the common people's actual ears. Herbert Hoover, who's going to play a big role here, assumes the presidency in March of 1929. So early in 29, he basically inherits, uh, March 4th, 1929. He was the second to last president to have his inauguration day be March 4th. And there's a very important reason for that, and it's solely because of Hoover. So he basically inherits this bomb that the fuse is just, you know, burning down on. But apparently Hoover's also kind of like a pretty intelligent guy.

He was an engineer, administrator, but he was kind of one of those people that if he believed it was operating right, because he had this rigid set of ideologies, that it's going good. It's not allowing him to kind of see the deeper issue. He rejects this like hands-off capitalism and government intervention approach. Instead, he believed that the federal government's only role should be to encourage business leaders, farmers, and labor unions to voluntary cooperate and fix the economic issues. It was the definition of let them pick themselves up by their bootstraps. That was kind of his whole view throughout the entirety of his time in the Great Depression was the government shouldn't be stepping in to fix this.

If these banks are all failing, then it's these private banks' faults for a faulty system. It wasn't about for him being like, who's being affected? It's not like the banks are the ones losing out on anything. It's all the people that had their money tied up. And when he has this idea of like, well, tough shit, it's not going to make him very popular. Hoover did some bad things. Hoover did some wrong things during this period in time. Hoover made his biggest mistake on inauguration day.

And it was coming out in his speeches, he declares that America was closer to the final triumph over poverty than ever before. He's saying stuff like Republican prosperity has reduced hours and increased earning capacity, silence discontent, put the proverbial chicken and ever. pot and a car in every backyard to boot. Who's parking the car in the backyard? That's, yeah. So, we're rich enough to have a car in the backyard,

but we're not rich enough to have a driveway. What are we doing here? He came out and just so boisterously said, we have this thing licked. We are the richest country in the world. We're this close to kicking down the door in poverty and arresting it forever. Eight months worth of denial.

later. It was the North Korean grocery store. He's like, we are completely fundamentally sound. Look how fat our children are. Yes. North Korea has a many fat children. He views this wild stock market speculation is this isolated psychological problem that's just like dealing with Wall Street. I think because he was very old school about stuff, he didn't understand what was just brewing within this stock. And maybe how? how large this thing was. Well, yeah, that's just it. It's an isolated problem, but when you isolate a nuke, it's still a big problem. Yeah, because he believed that the production, employment, and banking system were completely insulated from the stock market. He did not realize that those things had been completely and utterly, like, intertwined. And because he believed, like, the core economy itself outside of stock market was healthy,

he assumed that if there was this crash or anything, the downturn would be really brief and it would, you know, self-correct itself. It's not the sharp decline. It's the slow lead-up. Well, but in his defense, and I'm not saying that seriously, he did call all these corporate leaders to the White House and he made sure to ask them for voluntary pledges that if something did happen not to cut wages or to lay off workers and without, you know, without any mandatory government regulations or like federal relief.

Yeah. If you don't have something that is going to be a binding contract, it was just these voluntary agreements of like, so, you know, you control all these workers, make sure you don't fire any and don't cut their wages. And he's like, deal. And he's like, sure. He's like, great to hear it. First thing these guys do is, again, without anything to go ahead and stop them from doing it,

they just start, as soon as their profits evaporate, they're just getting rid of people. And that's the double-edged sword of that, is yes, we will keep wages at a normal level. But as soon as we stop making a profit, we're going to fire all of those people because we can't afford to keep everybody's wages at that level. God damn it, Mike, you stood in the office and you said you wouldn't do that. You shook my hand. No, I kept my end of the deal up. I'm paying them the same wage. I just had to fire half of them to be able to pay the rest of them the same way.

No, part of it was that you wouldn't fire them. Oh, shit. That's right. You know what? That's on me. Hey, you know what? Had we Pinky promised? I probably would have kept to them.

But didn't do it. In the months leading up to October, the Federal Reserve, this is kind of where the flags start flying in a quieter way. Federal Reserve tightens the money supply. They raise business rates. There's slowing economic growth. In September, there's a British. financier named Clarence Hatri. He was a corporate finance company guy. He had a lot of money

invested in a lot of different places. And then he got caught with some fraud. Got caught cashing in for a million dollars that he was not backed by anything. He just basically trying to steal a million bucks over in England. As soon as he, his business collapse, you start to kind to see a little bit of rattling going on in these European markets. When you see the rattling going on in the European markets and seeing a giant financier go down, U.S. investors start to get a little spooked. Again, not the middle class, not the guys that don't know what's going on over in England. Because we don't know what's going on. Yeah. Guys that are involved in worldwide markets.

By early October, we get finally more analysis that are coming out and warning, hey, the market's dangerously overvalued. Stock prices didn't jive with the earnings of these companies. and you get these rumblings of, ooh, okay, who's going to be out first? The guys that are leveraged pretty high or the people that are saying, oh, God, that's the food on my kids' table. It's going to be going away. Yep.

Before we jump into the crash, we want to take a bathroom break? Let's do it. Sweet. Well, hello. Listen, while we head to the restroom and get ourselves, something to drink. Why don't you do something nice for yourselves? Head on over to patreon.com slash historically high and get signed up for a little bonus content. I mean, come on, you deserve it. If you want to keep up with this, our main source of social media is going to be our Instagram,

which is historically high pod, P-O-D. You can also head over to it's Twitter, it's X, it's Twitter, come on, at historically high, and that's high, H-I-like. If you have any recommendations, you want to get to us, just want to reach out and say hello. You can hit us up on our email at Historically High Podcast, H-I-G-H-H-H-H-H-H-H-H-H-H-H-H-H-H-H-H-H-H-H-H-Sat. Let's get back to the good stuff. All right, the crash. A lot of blackness. Yes.

A lot of black days here. This all begins in a sell-off on October 18th. known as Black Thursday. Everything is looking a little, well, I guess 18th wasn't Black Thursday. 18th was a lead-up when this first major sell-off happens. There's rumblings in the market. There's a recovery that happens in between that in August, or October 23rd. October 23rd, stock prices begin to drop about an hour before the end of day.

And this is a big issue. total market value drops 4.6%. Panicked investors take the night to kind of think, okay, what are we going to do on Friday? How is this going? The problem with all of this happening right around the end of day is because everybody is getting their information from something called a stock ticker.

If you've ever seen ticker tape that comes out of these things, it's just literally a big long strip of tape where the stock prices are printed off. That's why they have the shorthand for it. Yeah. And because it used to have to come out in almost a morse code or information going over a wire. And then the... So when you have a...

And someone would read, hold on, read it. So, you know, this isn't Wolfo Wall Street with, you know, phones and everything like that. This is in the stock exchange where it is guys on the floor holding up the fucking tickets and everything like that. Other guys surrounding them, you're trying to sell. They're trying to, like anything and everything. And it's a fight. Because when stuff starts taking a shit, there is just mass panic in there. And you're sitting back in Dubuque at a barber shop where there is a ticker printer looking to see how your stocks are doing during the day.

And at the end of the day, there's this giant market surge. Market closes at four, your time, three, your time, whatever. You're sitting there looking at the ticker tape trying to see where you ended up on the day. and it's not coming and it's just spitting out all this other stuff. They're like, oh, okay, it must have been a busy day

on Wall Street, sit there for an hour longer, you're looking at the ticker tape, still no mention of your stock. 7 o'clock rolls around, you finally get your stock number and you might see that your stock dropped 3, 4% in price

and you know that you would only had about 2% gain since you bought that on margin. And then the very next day you're getting margin calls from your broker saying, I don't know if you saw what happened. You said, yeah, I saw what happened.

I saw what happened three and a half hours after the market closed. What the hell? He's like, it's worse. Yeah. And that's why we're calling. Because if we don't call now, the fucking bottom has come out. And it's not just like we're calling you because we can get your shares and sell them at 90 now. We need the money now because if we get it now, then we're back and getting, you know, our funds.

If we can't, it's already down at 70. and we're taking it and we're selling it at that. And then you're still paying it back. So these panicked investors have a night to think about what they're going to do. That was Wednesday. I'm real bad at days here.

October 24th, this is the October 24th. This is the third time that I've tried to call something black Thursday. Okay, hold on, hold on. Okay, so the day that it starts is... 23rd is the first big sell-off. The 24th, Black Thursday, the market loses 11% of its value at the opening bell.

Within the first three minutes, there are three million shares that accounted for about $2 billion that is sold off in the first three minutes. This is the market reaction to the dip that happens on October 23rd. And this throws everything through a loop because those first three minutes that so many stocks traded. Now for the rest of the day, that ticker tape is never. going to run correctly. And if by chance you do get a look at it early in the morning and you see that everything is dropped and you start screaming sell, sell, sell at your broker, and they're trying to get that call put in to sell your stock off and it doesn't get in because the market's flooded with other sales at that point in time, by the time they get to your sell, you don't get the price

that it was at when you put that call in for the sell. You get the price that it's at when it's happening. So keep this in mind as we're talking about this stuff Because as we learn it in school This is how it sounds to me of just like This is just a bunch of fucking Wall Street asshats That are losing money on a bunch of guesses they made Because I was looking at that also Through the perspective of FDIC

Your money's in the bank The safest place it can be in everything But at this point These banks, even the small ones Are using their clients, their people's money to invest in the stock market and when all of this money is lost

all of these people that didn't know their money was being used for this lose everything and not to mention the bank's doing it this is at a point in time where you could walk into your local bank and say I'd like a $10,000 loan to invest in the stock market sir the bank could say yes sir here's your $10,000 would you like to sit down with one of our people that can get you all set up with that

Yeah. It was basically, it was fucking slot machines in a gas station is what it was. I'm not 100% sure how it works because I don't know if anybody has the balls to do it anymore. I don't think you can just walk into a bank and ask for a loan and say you're using that money to invest in the stock market. I would bet that's probably not something they do anymore. Yeah. This feels like a guy banging an animal type situation and saying no to that. The whole day is thrown off.

you have ticker tape machines again in these brokerage offices that are basically printing off the information four hours before that. And once you see it, you are selling off your holdings blind. You don't even know what number. You're just praying to whoever you believe in that by the time your sell order goes through, that stock has any value left to it. You can't even get noticed. That's the thing. Because everyone's losing their shit in trying to find the closest person. of what they're trying to sell or buy or whatever it is.

It's a situation where the exchange, and this had actually worked, I believe it was the panic of 1907 that this little trick worked. So they sent a guy out named Richard Whitney. He was the VP of the stock exchange. And he goes out and very publicly just to try to subvert any of this panic,

purchase it. They had a big meeting with a bunch of big JP Morgan type, Rockefeller types. and they all pull together $20 million and he walks out and he says, I believe so much in the stock market that I will buy $20 million worth of U.S. steel and other massively over,

he didn't say massively overvalue, but other blue chip stocks because I believe that this is just a bump in the market. And I'll buy them at above market price. So I'll be, yeah, I'm so convinced of this. And it sort of works for a little bit. Yeah. that it partially works.

The Dow recovers, I believe, by close, and it only dropped about 2%. Somewhere around 2.1%. Not a big loss. Not the 11% that it started dropping in the first bell. So what this is, is basically you're building the sandcastle, and all of a sudden the sandcastle, a tower starts to collapse and you run over and you catch it. But you know that there's no way to put it back up, and it's just going to start sifting through your fingers at this point.

that's what this infusion of the blue chip stock purchase and everything like that, it was just them going to grab it as it fell and it's going to last for a couple days. Well, the only reason that it lasts. There's a wave coming in. The reason that it lasts for a couple days is because you can't trade on Saturday and Sunday. Yeah. And shit is still going down. Again, because this is all relative to nobody buying anything, all these other banks going

out of business, people not having money to buy anything, and all of that information from the factories on money they've already spent for production saying we're not getting that money coming back in. Two days to think about that. Two days to ponder the investments. And from what I've heard, they said that there's a lot of agreement that by Friday, pretty much most of the middle classes out of the market. And the massive sell-off that comes Monday and Tuesday is all the big boys.

And the big boys hit hard because after this, weekend happens we get Black Monday on October 28th. Investors face just a rash of margin calls because all these brokerage firms have decided to exit the market. This fuels a massive slide. The Dow closed Monday with the record loss of 38.33 points. It was about 12% market value that was wiped out in a day. October 29th, the following day, Black Tuesday, investors trade more than 16. million shares that day alone. It's like almost 16 and a half million. The market losses in value because

these were all of the stuff that after those margin calls didn't work out, they had to seize all of the stocks and they were just dumping them on the market at any price. They said the market value that was lost was $14 billion. By the end of November, Wall Street had lost about $30 billion. And that was more than the total cost of the United States involvement in World War I. After Thursday, there's thousands of portfolios that are just wiped out. Just cease to exist. That day, the Dow lost 30 points, about 11.7%. $68.8.9 points of stock value was lost two days.

23% of the market was erased in two days. That's how fast this went. You know what's a crazy myth? What do you think of when, if they're talking about any of these days, what was something going on in New York as people were walking on the street that you've always heard in your life that they witnessed? Jumping off buildings, walking in front of trucks. There were zero documented instances of people jumping to their deaths from buildings on Black Tuesday. I'm a pushback on zero. I don't feel like zero.

They said it's a persistent urban legend. they said this is where it happened. Yeah. So Winston Churchill happened to be staying at a Wall Street hotel on Black Thursday and witnessed a guy fall from a window, which he actually wrote about. What actually happened is it was a German tourist who accidentally fell. And that actually happened before the market even crashed. As he's falling, Churchill just hears him going, no.

That must have been a Wall Street investor. Yeah. You're talking numbers. He's like, was that a spy? He's like, no, Wall Street broker. He's like, oh, okay. Post crash, August 30th, the market ends up regaining 28 points. It regained about 12%.

Same time, the market's so volatile at this point. It doesn't end up hitting bottom until November 13th. The Dow closed at 198.6. Yeah, I mean, this destroyed the savings of just regular everyday Americans who had never even bought a single stock. Just to put this into perspective as to how a bounce back, how long a bounce back takes, it wouldn't see, so the peak that it hit in September 17, or 1979 was 381.17. It would take all the way until November 23rd, 1954 to regain that number.

This happens in 29. The market doesn't rebound to the original high until. 1954. When shit started going down and like the scares and information would start leaking out, there would be these things called bank runs and they were these massive lines of like panic citizens that were stretching around city blocks.

All of them were there at these banks to withdraw their cash at the same time. And like you were just saying, you know, beforehand because they only kept a small fraction of those deposits, it's actual physical cash because they had been using all of their savings to speculate on the Stark market, lend to those

margin investors, they couldn't pay them back. And this is, I think it was said between 1929 and 1933. I'm not jumping all the way to head to 33, but just during that time frame, over 9,000 banks in the United States failed across the country. And again, when a bank locks it, locks its doors and goes out of business, that it doesn't matter what the person that had their money and they're dead. It could have been Nana who had her last $20 in the bank, and it's gone. $20 ceases to exist because it was loaned out in a very haphazard way that didn't see any return.

But, like, how do you, I'm trying to put, I tried to put myself in this mindset quite a bit this week. You're sitting there and you're watching all the shit happening on the news. People are talking about it at work. Did you hear about the crash Wall Street? Yeah. someone being like, hey, do you own stocks? You're like, I don't mess with that, man. I don't get involved in it.

I'm not that dumb. But yet, everybody that has that mentality and never did that were the ones that were still just decimated by it. And because stuff's not being sold, stuff is not being bought, companies, again, are laying off their workers. National unemployment surges from roughly about 3% in 1929, because again, it's the end of the year when this actually happens. to 25% by 1933. It leaves nearly 13 million people out of work. To be able to look at this just year by year. So 1930, blending shrinks.

You have the great planes that are struck with a severe drought. So all of those problems we talked about in the 20s are going to pale in comparison to the economic, or the environmental disaster. Yeah, go back and listen to the Dust Bowl episode. It's crazy. Dust Bowl might be a top five episode for me. I don't know why.

There was just something about it. It was so much, it was so enjoyable. I wanted to use the word fun. It wasn't fun, but it was enjoyable. Yeah. Ken Burns' documentaries to do research are always good. That's true. And you got to see a lot of photos about stuff

when you were seeing like the dust storms. It's like, no, that's not real. And you know, fuck yeah, it is. It's real and it happened a lot. This recession that was kind of brewing under the surface that nobody really wanted to recognize in the 1920s deepens. US GDP shrinks by right around 8.5% nominally falls to about $92 billion. Prices fall slightly. Hoover, as you were talking about, had pressed these industries into holding steady on their wages.

inflation crawls its way up to 6.4%. In 1930 alone, unemployment reaches 9%. So while still very short of the peak of it, 9% unemployment's a lot. But nothing happens fast because stuff's not just like being handled at the drop of a dime. Industrial production in the U.S. plummets by nearly 50%

as factory shut down due to the lack of buyers. Workers who do manage to keep their jobs, saw their hours slashed, wages end up getting cut. by an average of like 20 to 30 percent. So those are the people that actually are lucky enough to keep their jobs. As millions lose their income, can't afford renter. I mean, it's going to affect every single thing. Can't afford their renter mortgages leading to this like unheard of wave of foreclosures and evictions.

And then because of that, this is where, and where do we talk about Hooverville's before? It was during the Dust Bowl. It was during the Dust Bowl episode. So you get these homeless families. that are building these makeshift communities out of scraps of wood, metal, and cardboard on the outskirts of major cities. And then we get the birth of the Hoovervilles. People call in newspapers, Hoover Blankets, and then when you would have your pockets turned inside out because you didn't have anything, calling him Hoover Flags.

Playing Hoover Flags. Because he's, you know, the president has dug his heels in the sand with this weird non-interventionalist type of attitude. Lase-fair. The pull your ass up by your own bootstraps type shit. Yeah, the idea that the market will correct itself proves pretty quickly that the market is not correcting itself. And the reason it's not correcting itself is because once this crash happens, nobody wants to spend anything.

What are you going to do? You're not going to go out, you're not going to buy a commodity. You're going to buy a necessity. That's the only industry that's going to be able to survive, and you're going to have to cut down on that. So as far as cars go, if you were selling a hell of a lot of cars to people that are working in cities, if they can't afford a car, they're just going to walk.

There's another route to still do what they're doing. So kind of a crazy like juxtaposition is you have this first impacting farmers and people like that out in rural America. They kind of suffer through it at the beginning. But then you have the people that are getting, I think, the worst of it. I shouldn't say the worst of it, but seem to be in the most complicated positions, are the people in the urban environments because there are so many people there whereas out on like in the plains

and where it's happening in rural areas you can at least try to grow food you can try to kill some of your cows try to eat you kind of have some additional options for self-reliance in cities you're now becoming reliant on these like private bread lines and soup kitchens that have become like a permanent fixture

of just life in these cities that stretch on for blog like in New York, Chicago, it's in countless other cities. And there then becomes this, I'm trying to think it's like an epidemic of shame, where because of people being put out of work, men that can't provide anymore for their families, but still have to provide in the sense of getting them food, are standing out in these lines dressed in their full best work, you know, they got their jackets, their suits, and their hats on everything, just to try to have some semblance of like dignity.

And so like even looking at some of the pictures that you can see nowadays and everything, you'll see guys even still holding like their briefcases and everything in these lines. It's the most massive disconnect, I think, of this whole episode because what did Hoover say? Hoover said, if we give them money, they'll become lazy and not want to go back to work.

Yeah. And then you see these guys that are dressed for work looking so disheveled and ashamed because they have to go eat at a soup kitchen. There would be the inventions of these things called I want to say like penny kitchens or something like that where they would only charge

you would get a bowl of soup like a piece of bread and a cup of coffee for a penny. And the reason they said that they would charge just a penny is they would have given it away for free for this, but there was a sense of charity that they were trying to avoid in dignity that people can say

they at least like paid for their meal or they could tip or something like that. There was no federal safety net for like food stamps or anything like that. Malnutrition went through the fucking roof, particularly my children in like industrial towns and also like poor coal mining communities are getting hit by this shit. They don't talk enough about like the psychological toll that was just an entire generation of people that were driven to be workers that were told if you're not this, you're nothing, that experienced just this psychological shame of not being able to provide for their families at no fault of their own.

There's a reason why your grandparents hoarded everything. There's a reason why your grandparents canned food. Yeah. The reason is because they felt the shame of being poor and not being able to eat that they saved everything. Yeah. And that was so deeply ingrained. My mother-in-law is like that because that comes from her mother.

And shit, like thinking about it in that sense, like, yeah, then it makes me feel wasteful. But I've also tried to cook and look at a package. He's like, oh, here, just throw these on the grill. And it's a fucking pack of brots from two years ago. I'm like, no. I'm sorry. They've been smoked. Come on.

I kept them in the fridge. I had them in the freezer. Yeah. They've been deep frozen. They should be fine. Why are they different colors? These are pre-COVID. You know they're good because they're pre-COVID.

But it's the biggest slap in the face because the idea that Hoover thinks that people are going to get soft and not want to go back to work if the government helps them, these people are ashamed to go get a free meal. You don't think they're going to be ashamed to take money from the government. Do you know what happens to those people that get the money from the government? They start spending the money. And when they start spending the money that stimulates the economy. So by just completely denying them that and saying, well, they can work their way up, just, you know, they can pull themselves up by their bootstraps. If you don't have any money, you don't have any boots. Yeah.

You ate your boots. So how in the fuck are you going to pull yourself up? Well, I mean, and this leads to you get hundreds of thousands of jobless people, including a bunch of teenagers that are trying to come into the workforce, but because people with work experience are going to be pervert. will work for cheap, are traveling, you know, these teenagers are traveling the country by illegally hopping onto the freight trains. So you're getting this weird nomadic hobo lifestyle

of like a kind of like a population shift of them moving into different places. Like we just said, the economic crash collided with the environmental disaster. That forces 2.5 million of the, and you'll know if you listen to the episode, why they're Oki's and Arkeys, to abandon their rural farms and go towards,

California, this huge migration that goes out west. Again, refilling these population centers, but people having to live in like these tent cities when they first get there. Facing all sorts of harassment from California police, trying to keep them out of California, all sorts of segregation, all sorts of just racism, classism, pretty much any isom that's a negativism is being just foisted upon these oki's that are coming into California. And go ahead. No, no, you go. You were talking about the number of banks that fail.

In 1930 alone, 1,350 banks fail. That's a hell of a lot of banks. I want to say at the start of this, though, there were about 25,000 banks in the country. And I feel like we're doing it. Just imagine, again, I feel like I hate having to say this. When a bank closes, I don't give a fuck about the bank. it's the everybody that lost their money in that bank. So when Adam says 1,300 banks, then extrapolate that by however many hundreds or thousands of people had their money in these banks, this is people just getting cleared out of everything they have.

By May in 1930, auto sales had fallen below 1928 levels. So now we're seeing an even further regression there. Attempts to buy U.S. made products seems like a good way to go. They institute something called the Smoot-Hawley TerraFact that passed, and it just weakens the global economy. So we're dipping into the situation where now this other episode we're going to do. This is a major factor in that. Also, it really hurts because when you slap a tariff on somebody, they reciprocate. It reduces.

What? Yeah. What? I mean, this hasn't worked in the past? attempts to buy U.S. made products just kind of go by the wayside. There's a war that starts as a tariff war that happens because, again, it's not the exporter that pays the tariff. It's the importer that pays the tariff. And if you don't want to pay the tariff, you're not going to import that shit.

So not only are you, there's just shit that doesn't come from America that we're not getting in. you're also seeing a situation where there's no market to compete against in pricing. Yeah. Pricing just goes out the door. Yep. So not only do people not have money, but the stuff that they need has become more expensive. Yeah. Recivicar.

Not only more expensive to buy, but also cheap as hell to sell. Yeah. to the farmers are selling at low prices because what you can't get any money for it. Well, yeah, and then at the same time, too, if any of those farmers are dependent on anything coming from someplace else, they're paying more just to try to grow something that in turn might not even net them any money. Yeah. After these reciprocal tariffs hit exports decline from $5.2 billion in 1929 to 1.7 by 1933.

Just a huge loss. between September and December sees about 550 million in bank deposits lost so there's that number that you were talking about with all of those banks that are closing between September and December $550 million that was safely deposited into banks by consumers

is just gone nothing to do never to come back In what year was that in? This is 1930 alone 550 million and just random people's money gone. Wow. And again, that's not saying the equivalent today of 550 million. This is people whose savings in the bank that could get them through something

might have been $200, $300, and then think of how many people were in those same people's shoes and then figure out how many people that would fill up for $550 million. November in that stretch, Caldwell & Company, was this giant, banker ends up collapsing. It causes runs on all of these banks in the south. In December, Bank of the United States collapses. Fourth largest bank in the United States. That caused a shit ton of panic because people thought that the Bank of the United States was legitimately the bank of the United States, like the government. I got beef with that name. You can't call yourself the Bank of the United States. We got a Bank of America. What do you want? But if you're

fourth largest bank in the United States, if you're number one, you can call yourself the bank of the United States. I don't get how you lose the top spot. Everyone's coming to you because they would think that you were the biggest bank. So how did you fuck up enough that somehow three other banks

with names that are not the Bank of the United States got ahead of you? Yeah, if you ever go to the top spot. Someone caught US Bank, got in there, maybe Chase, but J.P. Morgan because people knew what he was doing. Yeah. There's a chance that the Bank of the United States,

States got lapsed. It's like when somebody's trying to figure out what they should name their landscaping company, it's like call it freedom landscaping. People will hire us on name alone. Yeah. It's all about name recognition. But when you go under or when you collapse, name recognition is not a good thing. Because people are like, weren't they huge?

Yeah. And this is what sparks a nationwide run. 1931, not good either. 2294 banks end up falling. Their deposits totaled one. point seven billion. So on top of the 550 million lost last year in deposits, 1.7 billion lost in deposits in 1931 alone. 133 businesses a day on average fail in 1931. Drink that in. You said 133 on average per day for the entire year closed down. Yeah. Unemployment. Unshockingly after that last number

hits 16% or nominal GDP falls below 77 billion after sitting at whatever number is said 92 billion in 1930 um growth shrinks eight and a half percent inflation crosses 9 percent it's so bad and hoover's pull him up by the bootstraps approach should have seen he's sticking to it man yeah he can't call him anything if he's not consistent. Well, getting back to it, the biggest thing that Hoover did wrong was that inauguration day speech. That promise. No, who, who.

I think the next thing you're going to talk about is the worst thing. Yeah, worse thing, but the dumbest, okay, the dumbest thing. There you go. No, I still think. Yeah. But, okay, the biggest, uh, nat, the, I don't even know how to describe it. Second. Just call it second.

Yeah. If you lose the trust and the faith of the people when you go for your next speech and you tell them to put their money in banks to try to boost investment, you can't believe him because he just told you. We have no chickens. I don't know why panx in the backyard. No chickens. There's no cars in the backyard anymore. We don't have backyard. Motherfucker, we lost the house. I got a Hooverville. You know how small my backyard is now? And there's nothing that's ever going to gain the public's trust back. So no matter what he tells them to try to stimulate any sort of spending, it's just never going to happen. He's so dumb. He's so dumb. So dumb. So, May 15, 1944, Calvin Coolidge had vetoed a bill that granted bonuses to World War I veterans.

Congress luckily steps in. They override his veto. Soldiers were issued something called certificates of service that matured in 20 years. So many problems here. A, 1924 is when we're going to grant World War I soldiers a bonus. Didn't World War I end in 1918? It was a 20 year? No, no, this was the first bill.

Okay. So I know this. Okay, so the certificates of service, they matured in 20 years. Yeah. So they were going to get them in 39. But the first time they brought up giving bonuses to World War I, vets was in 1924. Six years goes by after the war, and they finally go,

oh, hey, those guys that fought in World War I, why don't we give them bonuses? You're trying to see where you're, okay, I get where you're going with that. I'm not even going to play devil's advocate of saying, like, they have to create something. Listen, man, based on what's going to happen here, I, okay, it shouldn't be shocking. No.

No, yeah. And then to get to the point of maturing in 20 years, if you were exposed to gas or if you had some sort of a wound 26 years after you're going to survive a role hopefully that went to the family or could somehow be transferred

or anything like that because if you're talking like that that is so shitty I mean but here's the point here's the thing it's not outside the realm of possibility no is like oh well you know we'll only have to make good on half of these

300,662,374 of these certificates were issued. It's a lot. I can kind of understand and maybe put it into perspective the maturity date 20 years later, knowing that you're going to have to raise that big of a fund. These were also paid based upon service time, your time abroad, your time at home, any sort of terrible injuries. Different tiers, things like that. There were different stipulations added to them.

And there were actually, once the bill was signed, I believe it was like anything under $40 was just paid out immediately, but everybody else was going to have to wait. It's too long. We're going to be too far into the Depression. Shit, we're going to be after, World War I will be over before the, or World War II will be over before World War I can get their bonuses. if they matured in 1946.

It wouldn't be 40. Oh, they did it in 24. Yeah. Okay, but then it was 20 years. So it would be 44. So we'd have been headlong into World War II. Yeah. We'd be at the tail end of it.

There would be guys that fought in World War I. They were actively fighting in World War II. I don't think they'd have to fight, but it would basically be like, hey, I hope they'd be the guys fighting in that war that are talking about their dads. Yeah. Money? My dad? Oh, my dad must have finally, it's 44, my dad must have finally been able to cash in on his thing. I wonder if they'll set us up with the same deal.

You get a letter from... So in 60, yeah, in 65, we'll get some money. You get a letter from your dad on the warfront. It's like, hey, junior, guess what? My World War I bonus showed up. Daddy's flush. When you make it back, lobsters for everybody. It's too late.

All of these veterans have suffered through two years. of this depression. And January 1932, there's a march that starts in, I believe it was Pennsylvania, included 25,000 unemployed vents. Or vets. I don't know how,

because I heard it and read it two different ways. I heard they marched the whole way there, and I heard that they were brought to D.C. and then marched to the Capitol. Yeah, the guy starting it was from, like, the West Coast. or somewhere from somewhere in Oregon, wasn't he? Yeah. And so he was able to gather a whole bunch of people

and kind of along the way as he was traveling to the East Coast kept picking up more and more people. They came in, they basically wanted to meet with Congress or the representatives. He did, I think, meet with like the chief of the Washington police or something like that who basically said, hey, you know, you guys have 48 hours. Not like threateningly, but basically like we can't have an encampment

or we can't have you stay longer than, 48 hours. There's too many people. And the guy was just like, we're going to stay as long as it takes for us to get our money, you know, for this, for the war that we fought. We don't want to have to wait 20 years. We need it now. Yeah. And because we fought for this country and the government, the government should give it to us.

And they had a completely valid point in there. You'd think that Hoover would want to be like, send me a delegation of their guys. Not sure we can do the full thing, but let's try to kind of sit down and figure this out. because guess what, we haven't had to step in yet to do anything to bail out any of these other people. So you'd think that they could do something for these soldiers. That's true. There was the ability that they probably had to pay these guys out.

Hoover decides instead. He's like, fuck these guys and orders the U.S. Army, who a couple names here, was led by at that point, he orders General Douglas MacArthur to actually clear out the encampment, the massive camp that they had set up like in some of the parks and everything like that of all these soldiers and to get them out of town. Was there anybody else that we would know? Yeah.

So the second in command to MacArthur was a guy named Dwight D. Eisenhower. And then just slightly under-participating also was a guy named General George S. Patton. Did they do anything after this? Yeah, they did. I can't recall what exactly. They may have made some noise in, World War II, I'm not sure. MacArthur went on to vacation in the Philippines.

He did. Eisenhower's probably looked upon a little bit more positively. And almost to a presidential level. Yeah, yeah, somewhat. Patton, Patton. What did Patton? He used guts to grind to grease the gears of his tanks. That's right. He was the general of the first army in World War II.

Huh. Interesting how these guys got a little start. Well, I mean, he gets practice here because they have to clear out the veterans using tanks and tear gas. So the U.S. Army is tear gassing. And might I add also, like burning down the encampments of these soldiers, they had fixed bandnets on to actually drive them out. The photos and images of U.S. troops attacking wounded American war heroes from World War I basically got around to everybody within the country. And Hoover is there, because of course it found out that they're not doing this without Hoover's approval. That was it for him.

It was political suicide to do this. Yeah. It's, I don't know how to really phrases. Did Hoover not know that cameras, photographing devices existed at this time? Was he not aware that like this thing called the telephone had been invented that allowed communication? There were newspapers, reporters. pictures that were able to be taken were then able to be put onto many, many

pieces of paper and sent around the whole country. Like tanks in a park. That field. On U.S. soil. Against World War I heroes who, because this is pre-World War II and that's not even a thing yet, they were heroes of the Great War,

the largest war that had ever occurred at the time. And guess what they're asking for? The money that they were promised. Maybe not at that time. But everyone can everyone can identify everyone can sympathize

because everyone's going through the depression it's a different level of sick seeing amputees getting pulled out of the way of tanks and shit even to think

because we know that war trauma is carried for life after this you have guys with rifles and bayonets running at World War I veterans

that had seen that in the darkest moments of their lives. Yeah. And it's happening again, except for this time, it's their side in their country. Yeah. All that shit that they thought that they left in Europe is now happening on their soil. By the people that they fought. Yeah.

Yeah. This force was known as the bonus expeditionary force, along with the 25,000, this Hooverville, that they had built in Anacostia Park, which is where the military intervention happens, I believe it grew to like another 35,000 people as they were Hoovervilling it up. There were actually other vets that had joined and just people that wanted to support the cause that had taken up residence in these partially demolished buildings on Pennsylvania Avenue. So on the same road as the White House, they've taken up residence. And they actually sent the police forces in there to clear out the buildings.

And at one point in time, there was a police officer that just started shooting. and he ended up killing two World War I vets that would end up dying from their wounds. William Hershka and Eric Carlson that died at the hands of a police officer because they wanted their bonus. And this is how close the bonus was to actually happening getting passed because they put forth a bill finally. It was on June 15, 1932. The House had passed what was known as the Wright-Patman bonus bill, 211 to 17. So they are one step away from the Senate accepting this and them getting their money. So even though Hoover told them to pound sand, Congress wanted to make this happen.

And the bill ends up failing in the Senate 62 to 18. That was how much hope they had with the House and how badly it was dashed away by the Senate. And so you have an anger that's already brewing and building. And then you face the police. and then you face your own military. And then they run you out of town where you don't end up with anything that you would hope to get

in your back at square one, but now you have maybe the highest level of distrust for your own country that you could ever probably feel somewhere around there. Yeah. I just, it's unbelievable. How terrible.

This is literally how you get situations where you can legitimately now kind of like not, tinfoil hat style, but you can be like people that don't trust the government because their grandfather didn't trust the government. Then you think about it for a second, you're like, was he one of the 20,000 at the park or that went through something like this? So like, actually, yeah, and you're like, totally understandable. I can see why you would never trust anything about that. This type of, like, protesting wasn't just in these cities or in

this instances. In the Midwest, you had these farmers who would form groups to physically block roads, like stop these like milk trucks on highways and dump them out. So like their stuff wasn't getting taken out. And also like joined together to prevent banks from foreclosing on their neighbor's properties. Basically forming like gangs that were like, I don't think you're foreclosing on this house today. And he's like, I don't think I'm going to today. So like bankers, it would have to just be basically intimidated off properties.

And then there were the instances when they actually made it to auction. And the way that these auctions would go is any. prospective buyers that were there that were outside of this group of farmers that were protecting their own. First bid that came in was always at a penny from one of the people in the gang. And everybody else that wasn't in the gang had somebody standing right next to them that was in the gang that just whispered in their ear, you're not going to bid on this property. Yeah. And nobody else bid. And the bank took one penny for hundreds of acres of land. And then the mob gave that land back to the farmer that lost it.

Yeah. And that's where you have to start relying on. And that's, fuck, I hate to get like, try to like wax poetic. That's one thing that we've kind of really lost is, is that sense of, like, unity for, like, just the people of the country and not being so fucking polarized about it. But on a, I guess, weird, not really, kind of a more positive note, just to interject a little bit of positivity into this shit. The Great Depression also leads to this entertainment shift. So movie tickets cost, like, only a quarter. You got to go in some place. It might be air conditioned.

You at least get to get out of the sun. So this made the cinemas like a vital sanctuary for a lot of people. And Hollywood would produce, you know, musicals and comedies, monster films like King Kong and Dracula were popular at this point. Really? Because people wanted to disassociate the fuck out of themselves from the horrible reality that was going on. King Kong's that old?

They made so many iterations. Wow. But this is like your guy on the Empire State building, like puppeteer moving. But still, seeing a giant monkey, terrorize the city that you associate with you losing your shit because the sock exchange in there is probably weirdly therapeutic. You're cheering for the monkey. Cheering for the king. Movies like Little Caesar and like the public enemy became really popular because audiences were able to identify with these like anti-hero gangsters who broke the law. became really popular because audiences were able to identify with these like anti-hero

gangsters who broke the law of these like what they saw as these corrupt institutions that had failed ordinary citizens. This is why there was so much public interest in like Bonnie and Clyde and things like that. Not so much for the murdery type aspects of it, but for like sticking it to the man. You mean the people that robbed the people? Yeah, exactly. By the mid-1930s, nearly every home had a radio and this provided free entertainment through like comedy shows swing bands

there were these afternoon serialized dramas which became known as soap operas because they were sponsored by soap manufacturers that's why they're called soap operas that's

fucking crazy right if you remember if anybody remembers anything from this episode it's how soap operas got their name. Wow. And then like cheap home-based entertainment exploded. So dude, this is where you get like Parker Brothers capitalizing on this like financial crisis

by mass marketing monopoly in 1935, basically putting people in charge of their own financial like fortunes, basically like allowing like penniless players to fantasize about buying up real. That's so fucked. And I mean, I know even now in a weird way, the fantasy now is to be able to afford your own home or to be able to afford real estate. This was at a time when it was just like, I just need a board game where I can actually do something that I'm not even remotely able to do in life.

And it's all about this dissociation of just what's going on around them. Was there a rule back in 1930s monopoly that you like the banker couldn't be touched? There was no go to jail back then. It was depressing enough. There was no. Do not pass go. Do not collect $200. You're playing Monopoly sitting in a tent on Park Avenue

as you're purchasing Park Avenue. The other kind of silver lining of the Great Depression is these were the highest years in recorded history for graduation rates in the United States up to that point. Because if there's no job market to leave school to go to,

at least you can go to school. Yeah. So you might as well stick it out and graduate because it's not like you can leave early and go get a job in a factory. There are no factories. Yeah, like working when you're 16 instead of just being like, I don't need to finish this out.

That's largely how 1932 goes. And 1932 is it's moving along, we have, this is an election year. And the Democrats, I don't know if you could ever look up and thank a higher power for the military attacking the military. But if any political party has ever been handed a gift, this is the greatest gift that's been handed.

It's the office on a silver platter. Yep. And even the guy that can't speak says something. You could put Brutamblin as your candidate. And he'd be like, I love America. I don't like Herbo Hoover. People'll be like, that guy. Well, the curtains, part on the stage, you hear squeaky wheels.

Shut, fuck up. Roll up. The spotlight hits. He had the greasiest squeak free wheels of anyone. Spotlight hits the stage. FDR with his blanket on his lap is ready to take the country. He's ready. He has plans.

He doesn't have plans. He has, ideas that he's going to try. And if they don't work, he's going to abandon them. It's a very flexible system that FDR is going to start to build. But at the same time, we have all the way up until November for this election. And Hoover's realized that his presidency is pretty much done. So after everything happens with the bonus expeditionary force,

Hoover has no motivation to change things. This is just the country trying to survive on its own. without any sort of help. Hoover's not doing shit. I know. Hoover's not trying to resuscitate his image. He's never, ever going to be able to do anything positive. Yeah.

And at that point in time, I understand that he's a victim of his own circumstances, but there's eight months where he wasn't going to be able to do anything. Like, nothing he was going to be able to put in that event. But to not even attempt. Yeah. That's fucked up. Yeah. I guess maybe that's, The next thing, the next best thing that he could have done was do something to try to push the economy forward for FDR to take over.

That's about it. So FDR is elected November 8, 1932. Inauguration is March 4th, 1933. Immediately after taking office in March of 33, FDR is like, he has this thing about the first 100 days. He's just going to tackle the shit out of this first 100 days. he's got FDR, he's got his thing that he's been touting the new deal. He basically declares a nationwide bank holiday calls Congress and do an emergency session to pass this emergency banking act.

He's calling a national holiday for the banks to close it, I think, for four days, right? I thought it was a week. I thought it was six. I thought it was Monday and Friday. He's attempting to stop panic withdrawals, all of that, try to actually kind of stem the bleeding. So as they do, this is to try to stabilize, like, the financial system. so actually trusted institutions that could still stand on their own could actually reopen and they could kind of take stock of what was going on. It was such a brilliant strategy and it had to go into effect very fast because like I was talking about earlier how Hoover was the second to last president to be inaugurated on,

what was it, March 5th? Fourth. March 4th. And then FDR was. They realized because Hoover had been a lame duck for so long prior to the election, that they still had just months of more lame duck, that they moved up the inauguration to, I think it's like January 20th now.

So a new, excuse me, to cut down on that, like six-month period or whatever it was, yeah. And FDR hits the ground rolling. As you said, he's bringing in economists. One maybe issue was that he didn't bring in a whole new batch of economists. He still had some of Hoover's guys that he was taking advice from. But yeah, he absolutely nails it with this executive order. that goes out immediately.

So a lot of this credit goes toward this woman named Francis Perkins. So do you have anything about her? No, go ahead. So Francis Perkins was like Roosevelt's like ace in the hole. She was his secretary of labor. Oh. So she was the first female cabinet member in U.S. history. And she had been with like the labor unions in New York or something like that.

So she had a real good grasp of how like negotiations. with different labor unions and everything worked. And that's how he met her, right? Because he was governor of New York. I believe so. So she kind of used that insider knowledge and everything to basically shape his economic, like, policies. She became the mastermind behind some of the, that recovery era's like most foundational, like social welfare programs. They said she was pretty much like kind of the architect.

While he was the face of the New Deal, she was like it's architect. So she was the driving force behind the creation of the social security system. which provides that vital safety net for elderly and disabled Americans who got just fucking hammered again when all of their savings that they were holding on for the retirement was completely gone. To get that bill finalized, she actually locked her committee members inside her house and just loaded them up with scotch and refused to let them leave until they ironed out the legal framework for the Social Security Act in 1935. She championed the Fair Labor Standards Act of 1938. I'm just kind of covering all of her stuff right now, then we'll jump back a little bit. She established the first national minimum wage,

strict limits on work hours, and bans on oppressive child labor. FDR agrees to all of these things that she's putting out because basically all of it makes it weirdly enough it does his common sense shit to try to increase just the general health of like the American workforce. She helps FDR implement these massive,

massive public works programs like the Civilian Conservation Corps, who basically were the ones that helped in response to the dust bowl for replanting all those trees, would do a ton of public works projects. That provides jobs to millions and stimulates the struggling economy. And then just within her time, just kind of a little fact about her, she was this like master of like political illusion or how she appeared to other people. So she would, because she's done with just all dudes and everything. a little bit older. So she intentionally dresses

in like conservative like motherly clothes wearing like even like a hat like an old lady would and she basically said she goes, listen, if I remind these politicians of their own mothers or grandmothers, they're going to stop yelling at me and they're going to listen to me and they're going to vote for me because these are

people that they've been bred to listen to. So she gets a ton of credit for all of this new deal shit that FDR's going to be getting the credit himself for. Just to put into perspective how important creating Social Security was in this new deal, at this point in time, prior to the crash, there was no welfare state. All of these other countries in Europe had already been around long enough to understand the need for social safety nets. To put it into perspective, just think about your grandparents if you're lucky enough to still have them.

1928 there was no official like poverty line but historical records can go back average salaries and all that kind of stuff and figure it out 1928 roughly 60 to 70 percent of elderly Americans live below the poverty line and a big part of that is older adults used to just live with their kids and that that was how they lived which social security is going to give them a set amount of money to be able to live on their own, do whatever they want. An older person living in a house, as much as you love to have them around and want to see them do well, is another financial burden.

100%. So that in itself, allowing them to not be that financial burden will then allow that house with that working family to thrive even more to purchase more consumer goods, which in turn will try to stimulate the economy. So there are layers and layers to the development of this stuff. If you don't have 80-year-old mom and dad living in your house, that's two less miles that you have to feed. We saw what happened in Willy Wonka in the chocolate factory when Charlie and his mom have those four dead beats in the bed. Grandpa Joe.

Fucking war criminals is what that guy is. Yeah. It's kind of wild to think, as you were talking about during that banking. Oh, do you have anything else? Francis? No. Okay. I just want,

oh, she is strong-looking lady. That's what I'm talking about. If she looked motherly, she didn't want these guys to fuck her. She needed them to listen to her, like it was their mom.

This was at a time when content of character. This isn't a Catherine the great situation, my man. Okay. This banking holiday, this executive order 2009 and then the emergency Banking Act that gets enacted on March 9th

after this is already going on, it ends up finding 4,000 banks were deemed just shit and insolvent and closed. They closed 4,000 banks that were still open. Yeah. They were just barely hanging on that hadn't had runs on them yet.

I don't know if we explained it. A run on a bank is just pretty much what it sounds like everybody's running into the bank. That's what it was. I explained those lines where people would just try to mass withdrawal. Yeah. But by the end, of March 11th, there had been a decent raise because in between that time, we'd had an FDR

fireside chat where he was in his best cardigan and he would roll up to the side of that fire. That's what he told people, didn't know that. They just called it that because he would be speaking to you in a way that like an older member of the family would, just very, very casually. Yeah. And he tells people to put money back in. banks. He tells them what he did. He tells them about all the bad banks that were insolvent that he closed. He tells them it's time to start putting money in the bank. He gets to basically kind of keep people, because he knew everyone had radios. And he knew, you know, large portion of people aren't doing anything entertaining, so they should be at home because

everyone's broke. So he used this in a way no one had ever used it before to basically let people and keep them appraised of what was going on with the banking reforms and trying to use this to restore public confidence in the banks that remained and to provide them assurances that things were being done like creating the Federal Deposit Insurance Corporation or FDIC, which was June 1933, to ensure those individual bank deposits. He did the Agricultural Adjustment Administration to stabilize like farm prices and prevent widespread foreclosures to keep people in their houses. But I mean, these things are because of how bad it is, it's crazy how quickly these bills and reforms are like are going through. Speed of light. Yeah, 1933 is such a big year. And just based upon

the restoration of faith in the presidency that bringing FDR in, because you know Hoover was screaming at the top of his lungs, put your money in banks, put your money in banks, put your money banks. But not doing anything to like other than just telling them that. Yeah, but he had also eroded everybody's trust by swearing that they were going to lick poverty that is now touching more people than it's ever touched in the United States. So as soon as FDR says it, the trust in FDR is built back up. By the end of March, so he, March 15th is when the rest of the surviving banks opened back up. Fireside chat happens. By the end of March, $1.1 billion had been deposited back in banks. That was how much trust they had.

an FDR. As you were talking about March 20th, right after that, this comes in rapid succession. Economy Act of 1933-slashes $243 million in government salaries, pensions, and veteran benefits. Not the best one to end on there. Veterans benefits, especially after what Hoover did. Not great. March 31st, the CCC, the Civilian Conservation Corps is created. So he's put in, What did we say? March 5th? March 4th is when he's inaugurated. Yeah.

Before March is over with, he creates the Civilian Conservation Corps. The CCC over its lifetime would put over 3 million young men to work, including a quarter of a million young black men and 80,000 Native Americans. It's putting people back to work. And the CCC did a lot of work. We talked about them a lot pretty heavily during the dust. Bowl episode. They were the ones that planted that big belt of trees from north to south. Also, there were people that were just out there digging holes and filling holes.

Well, they were out there like building like Knikes for waterways and like flood areas and stuff like that. Actual physical infrastructure. One of the things too that we forgot to mention is as far as the effects of the Great Depression, everybody was affected, but there was definitely disproportional effects for like other races and also like women and minority groups. So black workers faced, you know, horrible systemic discrimination. National employment, while it set at 25 percent, black unemployment in urban areas, soared past 50 percent. White workers, and what occurred is, basically white workers took over traditional, like the low-paying service jobs like janitors and domestic servants that had traditionally

been held by black workers. As jobs grew scarce, you know, local and federal authorities, a lot of this stuff is going to sound very close to, like, recent events. And it's because history fucking repeats itself when you don't pay close enough attention. So pay attention. When jobs started growing scarce and again to try to get people and work toward this economic recovery, they basically initiate this aggressive Mexican repatriation. Why can I say this?

Repatriation. Repatriation program. Unconstitutional sweeps resulting in the forced deportation of an estimated 1 to 2 million people of Mexican descent. approximately 60% of the people were actually legal. American-born citizens. Why does this sound fucking familiar? Interesting. Women face severe backlash for working, basically,

because they were saying, hey, you guys are taking a man's job, a provider's job that should be going to a male breadwinner. Several states actually even passed laws legally banning married women from holding teaching or civil service positions during this time. And then despite all this, backlash and even some laws being passed to work against them, women's employment actually

rose slightly just because of like female dominated fields like typing, nursing, seamstresses or retail, like sewing alterations, things like that, were hit less hard by factory closures because you still needed people to kind of do stuff like that. So you saw millions of these traditional housewives taking on a different role, keeping families afloat by running home laundromes, or taking in like running small boarding houses or man stretching meals to like the absolute limit i went through and looked at some of like the meal ideas that they would do this is where you get like just beans with like the bone in ham or like a ham bone in there that would flavor it this is where you get them making figuring out how to make apple pies without any apples at all where you just

take like evaporated milk or water and soak it with ritz crackers and lemon juice and they're like remarkably when you put a pie crust in it, it tastes like and has the texture of apples. But just insane things about just trying to provide for their families, like learning every variation of potato, Forest Gump style like he does with shrimp, of they said potatoes were one thing that kept like so many of these families afloat because these women are figuring out any and every way to like create things. And that's just it. That's exactly what you were talking about with the people that were in the bread lines.

You don't need potatoes a million different ways. You don't need a mimicked apple pie. Those are the creature comforts that make you feel like things are okay. There's no dietary staple of pie. But when you're eating pie, it might take you out of just the shit situation that you're in. Yeah. And it's what they were trying. It's going to the movie.

Yeah. It's having something that you had before all this that reminds you of not, shit. You don't have to do a million different things with potatoes. You can eat mashed potatoes every single day. It's not going to be great for you, but at the same time, you're still getting whatever nourishment that you're getting. But if you

can prepare it any other way to make it feel even a slight bit different from the doldrums of the day, it's going to raise your spirits in a way that really nothing else wasn't this time. Effective, May 1, 1933, FDR enacted. This is where FDR gets a little creative. I

like the scoundrel kind of sneak move that FDR pulls here. Executive Order 6102, forbidding the hoarding of gold. The set goal was to increase the gold reserves so they could issue more money. We didn't have a lot of rules back then, but the Federal Reserve Act of 1913,

so fairly new implementation here, required that 40% gold backing for notes, so you had to have up to 40% of the gold, back the amount of paper money that you could put out there. He said sell-off price at $20.67 is what that acted in 1913. In 1934. 1933.

So 1913 is when that was set up. Gotcha. Okay. Or the value of 2067. When that standard was set. Yeah. Okay. 1934, now that we're in the Depression, gold Reserve Act changes the gold content of the U.S.

dollar from 2067 an ounce to $35 an ounce. So it devalued the U.S. dollar to increase the money supply they could create to basically try to kickstart an inflation, right? Yep. So Gold Reserve Act orders all citizens, banks, and the Federal Reserve to hand over their gold coins and bars to the U.S. Treasury. and then in exchange the government gives them paper money and that move then puts all the nation's gold under total government control which means they're able to set the value of it because they control it so before that gold was $20 for an ounce

after that they then raise the value just because they have all of it to $35 an ounce which allows them to go ahead and print more money to try to stimulate that. They didn't buy it back at $35 an ounce. No, no, no, they just increased it once they had it no one else had gold in which they could challenge them for the value of it. But they said that there were maximums.

I believe that everybody could still own like up to $1,000, maybe. It was either $100 or $1,000. And I understand that's huge. But it's not everything. At the same time, if you start showing up with more and more gold that you would hit and they're going to ask questions. Yes. But what this did is, you know, in their minds, this increases, you know, the money supply.

When more money circulates in the economy, prices naturally go up creating this art inflation, which at this point are you so desperate that you just want any inflation regardless if it's artificial? So it causes the price of wheat, corn, and cotton to rise because these things had been so low. Farmers can finally make a profit on their harvests. The farmer's old bank debts stayed at the amount. Those didn't go up or anything like that, which allowed them to go ahead and pay those, but with money that was now worth more technically because they were making more.

so they used that to pay those debts back now the money was easier to earn. All of this and also this, they made a bill against hoarding of gold, but then they turned right around and hoarded all the gold. This act actually led to the creation of Fort Knox. Yeah, you got to have somewhere to protect all that gold.

Fuck yeah, you do. May 12th, the Agricultural Adjustment Act, I believe you were talking about this earlier, boost the agricultural prices by destroying all the surpluses. So what we were talking about in the Dust Bowl when they set the government agencies out there to slaughter all of the extra cows or burn all the extra crops, it's, I got to, I don't even really know how to say this. So capitalism dictates that when you have hungry people on the street that are starving, that you burn surpluses of food because if you, if you. gave the surpluses of food to the hungry people, then they wouldn't buy the thing that you're trying to raise prices on.

My opinion remains the same as when we discussed this during the Dust Bowl episode. It's completely fucking stupid. It is. But at the same time, that explanation, if you're trying to kickstart an economy. Okay, I do. I have a counter to that. So because of the surplus and everything like that. and the Great Depression being this time of like want where there was a lot of surplus.

While millions of these city kids were like starving and, you know, malintrition, everything like that, rural farmers going bankrupt, they had these massive surpluses of crops. They couldn't sell again due to the act in which they couldn't flood the market with them. But what they could do with them is they solved that problem simultaneously or solved it in their own way, I guess you could say, by our due to. the Federal Surplus Commodities Corporation, and the government bought up excess pork, lard, flour, butter, and fruit from struggling farmers and shipped them directly to public schools. Now, to prepare and serve the food, another New Deal agency, the Works Progress Administration

of the WPA, hires thousands of unemployed women, and by 1937, the massive operation was serving hot lunches to over a million children nationwide. This is where we get the advent of the school lunch program. So because schools are completely dependent entirely on whatever like agricultural surplus they were able to gather at that time or sent them that week, the meals would be like crazy in balance. So whereas we were in school and you saw Monday, you had the schedule up and you saw pizza day was this day and everything like that. Any pennies? If the government bought out an apple orchard, kids might eat nothing but apples, apple suit and apple sauce for like days on end. So when ingredients finally did get

balanced. A typical five-cent lunch consisted of a vegetable or a peanut butter and tomato soup. Oh. Yeah, I know. A basic butter or peanut butter sandwich often, you know, stretch the peanut butter as far as you can. A piece of fresh fruit and a carton of milk. So the food changed a little bit, but man, it didn't change much. But yeah, this is the advent of the school lunch program. The modern day national lunch school was born entirely out of the Depression. And that circumvents the idea. of capitalism because this is something that you would have to pay to provide, but if it's already free there, that's just a straight path. Correct, and kids aren't contributing to the workforce

or anything like that usually. So, yeah, you're just, you're trying to make the best of it. Go ahead. June 16th, the FDIC is established, as you were talking about earlier, by the 1933 Banking Act. This also establishes prior to this, they had established the U.S. Securities Exchange Commission to start monitoring Wall Street a little bit. That was the next year in June. So that was like their big thing, that next year in 1934. That's when the SEC is created to regulate it. Do you know who FDR put in charge of the SEC?

I know who he should have. There was a guy that was like the actual guy getting shit done, but he was kind of aggressive and a little bit brash. I can't remember who he ends up putting actually in charge of it. Joe Kennedy. fuck that's right that wasn't his choice i don't know i think fdr wanted the other guy but they said the other guy was too much of a bulldog going against these investment firms and everything and they had to handle it with like a delicate touch because they still wanted the they had to basically

like pet the economy very very gently and not try to scare away these guys to take their money elsewhere so they put this guy in but allowed they put joe kennedy in as the president but then allowed this guy to serve like with the commission or with the yeah with the commission well joe was a choice after making a career of kind of living in the gray area so what was joe's relation to john uh father okay that's right okay yeah so joe kennedy might have lived on the fringes of legality because he was also like a broker wasn't he he was just and that's why they put him in there because he would understand him i'm sure he did some shitty shit too Absolutely. Definitely does.

Going along, because he's not done. No. Now the man just keeps moving. November 8th. Still in 1933, the Civil Works Administration is created. Over the lifetime of the Civil Works Administration, it would employ over 4 million people. It would be replaced by a permanent administration called the Works Progress Administration in 1934. 400 million in funds were allocated.

for work programs. And this was a situation where they would go out and do all of these different civil contracts as far as building roads, a lot like the CCC was, except for it was just a, I don't know, it was less of like planting trees and more of like paving roads. And it,

I would just get it closer. Oh, got you. this is another one of these things where regardless of the work that they do and they do do good work. I'm not saying that they didn't. But the main goal of this isn't to go out there and fix the world. The main goal of this is to put enough money in these workers' pockets that when they go home, they can stimulate the economy by spending it. I believe they were getting paid $30 a week.

25 of it? A month. Was it a month? It was a month. Oh my God. No, no, that might have been with the CCC. Okay. So 25 of it would have been sent home to their families.

Yep. I know, and I don't know if it was as prevalent here as with the CCC, but there was still a lot of fuckery going on as far as like passing people, like, deserving people, like, deserving people. It definitely wasn't a meritocracy. It was definitely, there was a lot of systemic racism in that and everything like that, discrimination toward people about advancing them in positions or allowing them. You traditionally saw the public works that they were doing that were a meritocracy, that were a lot of, you were a lot of, and that were lot more manual labor based. We're going to be done by like the minorities and everything. And then more of the what you would consider like the cush jobs would be taken over by

the whites. There was a program called the TVA, the Tennessee Valley Authority, and this built dams to control flooding and generate electricity, kind of modernizing this poverty-stricken Tennessee Valley. I just assume that there was a lot of places that didn't have electricity. electricity back in the 1930s, but a Tennessee Valley region doesn't strike me as somebody that would be even close to electricity. Yeah.

So not only are they able to control this flooding and generate more electricity for the power grid, they're also pulling an entire region, like into another decade of technology. Exactly. Yeah, they're able to kind of, they're trying to go back and like shore up in modernized certain areas. Uh, July 30 or sorry, July 1935 saw the creation. of the National Labor Relations Act, which was also called the Wagner Act,

which was meant to strengthen labor unions and boost worker wages to try to again continue just to pull everybody up. August 1935 was the Landmark Social Security Act that signed into law establishing retirement pensions

and unemployment insurance. And then jump before, do you have anything before the re-election? Oh, yeah. Okay. Got to bring some money in for the government, right? You got to.

Best solution to that. December 5th. 1933, Prohibition is repealed on a national level. Oh, yes. So you can start slapping that sweet, sweet tax

onto that booze. Not only that, but people can now finally get, you know, movies and board games went downhill as soon as Prohibition

was resolved because people just went after the one form of distraction that they had been yearning for the whole time. In 1933, Can't believe

an anomaly right now. That guy ate the thimble. He was drunk and he said this looks delicious and he popped it in his mouth. In 1933, inflation drops to 1% annually. We see a massive drop in inflation. Annual quarterly GDP or GDP finally turns positive by the summertime. So we were negative for the first quarter. As soon as summer hits, GDP is actually back in the positive.

We're moving in the right direction. Unfortunately, unemployment peaks in 1933 at 25%. There were approximately 2 million homeless people in the United States. And to go along with that, we talked about it earlier. I put it in your mind, the little feeler about the home mortgage defaults. Yes. In 1933, the home mortgage default rate was between 40 and 50%. So half of people were upside down.

or had lost. Yeah, dude. That's insane. If their property is going to banks, and the banks need to sell that property, but the banks are tightening their belts on lending, those properties are just sitting there. Yeah.

Because if you're not approving people for the loans to purchase the houses, that housing market is... Why's well let the people stay in there and at least take care of the house. that was another thing that they talked about inside of the cities is the amount of shame that people would have when they would come home from whatever they were doing

from the breadline and see all of their shit sitting out on the stoop or anything because they were kicked out of their houses for doing nothing else than living in the United States at the wrong time and not being rich putting their money in the wrong bank I guess that's their fault the fact that they weren't rich Yeah, up to the election, FDR had pretty much built himself up into a guy that was going to be a two-term president for sure.

There was no way that he was going to miss it. Was this the one that he took like 42 of 48 states? This was legitimately a landslide. I know people like to use that word fucking Lucy Goosey these days, but this is him winning re-election, a massive landslide. strong public support for his recovery timeline. He's touting, you know, I'm not done or anything like that. There's going to continue to be work throughout my second term. And without him realizing it, there was going to be some work for him in his second term because May 1937 rules around and there is a recession that begins resulting in unemployment going from 14%, which had been brought down like you said from 25. So that's huge. Goes back up to 20%. And there's a manufacturing drop off that's pretty rapid. with that as well.

So this is a fucking scare. This is a, you know what this is, this is riding on a plane and you hit a pocket of air. Yeah. And you drop down, you feel your stomach just lurch. This was a heat check.

He was on fire. Going into 1937, there were production profits. Slow your fucking roll, Frank. Shit's going to get real. Wages had increased. They'd returned to pre-1929 levels. Like you say,

14% unemployment. They decided that it, it was about time to start tightening the fiscal and monetary policies because 1936 had shown these signs of recovery. Inflation had been driven up, federal deficit, rising labor costs, all of the things that they had to do at this point in time was hurting business. Just trying to repeal everything that had helped it. So the United States was able to walk again. And then once they started getting it to a jog, that hamstring pulled, basically. all of a sudden we're back into this depressionary recession and fDR completely reverse his course

1938 he drops a five billion dollar spending bill a lot of this is just straight for public works and relief he's got the people back to work he's got the administrations he can't let it dip yeah it can't he's like i got to go ahead and stop the bleeding and then i have to change course and get us going back in the right direction. And it's going to cost money, but in the end, something has to pull us out of the recession out of the Depression. Oh, well, surprise, surprise, because ask and you shall receive, because this little thing in September 1939 called World War II begins in Europe.

And as this begins, all the sudden, just like the last go-around, in which it brought grace prosperity and wealth to United States, We see war in Europe and we see dollar signs. And the U.S. shifts toward wartime manufacturing to act as, and we've used this term, I think it was maybe in the Ford episode, to act as the arsenal of democracy is the whole point, which is, God, it's fucking sexy, right? Yeah, it is. That's fucking sexy.

Thank God they haven't, think God they haven't ruined that one yet. We can't change how badly operations are named. Yes. But that's a health title. That's just someone that said that's what we're going to act as. So March 1941, sorry, going back just a little bit, 39 when we switch to that, that creates a ton of new jobs. That also creates a little bit of boost in farming because now they have somewhere else to send

because they know along with war, it's going to automatically lead to this. So countries are going to want to start stocking up on like food and stuff like that. So lending or leasing. That's right. We're hiring people in factories. March 1914. Len Leesack Pass is pouring billions into defense production to supply allied nations. A few months after that, probably about nine months or so, 1941 in December,

the U.S. enters World War II after the attack on Pearl Harbor. Now, 1942 to 43, massive military's conscription and defense factory hiring drop unemployment to near zero and pretty much completes the depression recovery. if you've ever questioned if war can fix an economy it's a dark subject to think about in 1940 the employment rate was 15%. By 1944

unemployment was 1.2% within four years it dropped it basically 14%. So in a way us over doing shit for the the First World War and everything kind of contributes to putting us into the Great Depression.

There's a lot of other factors. But in a way, you know, 20 years later, whatever it was, now it actually pulls us out of the depression. But in our next episode, what we're actually going to be looking at is how the depression itself caused World War II to happen. So we're going to be looking at the Depression from a global standpoint because the impact that it had globally, while it was felt most here,

the ramifications of what it leads to are more than I think any common person has been talked to this point. Yeah, it kicks the door open. It just, it sets, you know what it does, it sets up Europe to be spinning plates with the illusion that everything's working

and a stiff breeze is going to bring it all crashing down. The reason that it is, way that it is, is because after World War I, the banking center of the world had shifted from England to the United States. And United States was the tastemaker. United States was the one that was doling out the recovery funds. They were the ones that were covering the loans for reconstruction in Europe. And I don't want to use the word colonialism because it's not. We were kind of talking about it. I was thinking maybe this is a little bit. of an international Fendom situation?

It is. And this is going to remember what we talked about before because this is where it all comes crashing down, is there is this extremely volatile triangle of loans and repayments that are basically just gently propping Europe up right now. And when something happens, and the money's no longer available for that

from the United States, that support just gets knocked right out. Yeah, bad deal. So... Until next time. Until next time. All right, we get to end it and just say, got anything else to know?

Because we're going to be talking about it in 10 minutes. All right. Well, we hope you guys enjoyed part one. Stay tuned for part two next week. And have a good one. We'll see when part two comes out. I say we just go back to back. Okay, we'll do it.

All right. Hey, can't take... Can't go back on it now. We'll see you next time. Peace.