Great Depression-New Deal Vocabulary
Stock Speculator On Margin Stock Market Wall St. Broker Margin Call Black Tuesday The Crash
Boom-Bust Cycle Inflation/Deflation Recession Depression Federal Reserve Fiscal Policy
Rugged Individualism Laissez-Faire Hoovervilles Bonus March First Hundred Days Bank Holiday
New Deal Alphabet Agencies Dust Bowl Okies Keynesian Economics Prime the Pump Relief
Recovery Reform Hawley-Smoot Tariff Demagogue
Categories: student information
Marriner S. Eccles, was the Chairman of the Federal Reserve from 1934 1948
In his 1951 memoir Beckoning Frontiers, Eccles detailed what he believed caused the Great Depression.
Our current situation is eerily similar.
Eccles wrote:
“As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth — not of existing wealth, but of wealth as it is currently produced — to provide men with buying power equal to the amount of goods and services offered by the nations economic machinery.
Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.