Explain the causes of the 1929 stock market crash and describe how the Great Depression became a global economic catastrophe with major political consequences.
On October 29, 1929 -- "Black Tuesday" -- the United States stock market crashed after years of speculative buying, and what began as an American financial panic rapidly became a global catastrophe. Because Germany's fragile 1920s recovery (week 19) depended on American loans through the Dawes Plan, those loans drying up hit Germany especially hard; banks failed across multiple countries, and unemployment soared worldwide, reaching roughly 6 million in Germany by 1932 and around 25 percent in the United States at the depression's worst. Rather than cooperating, many governments made the crisis worse: the United States' Smoot-Hawley Tariff of 1930 raised import taxes sharply, other nations retaliated with tariffs of their own, and international trade collapsed even further just when the world needed it most.
The Depression's political consequences proved as significant as its economic ones. With democratic governments seemingly unable to solve mass unemployment and suffering, extremist movements on both the far left and far right suddenly looked far more appealing to desperate voters across many countries. Nowhere did this matter more than in Germany, where the small, marginal Nazi Party's electoral support surged dramatically between 1930 and 1932 as unemployment climbed -- a direct, traceable link between this week's economic collapse and the rise of totalitarianism you study next.
Mastery looks like: They can explain why the 1929 crash became a global catastrophe rather than a purely American one, and trace a direct link between Depression-era unemployment and the rise of political extremism.
Common stumbles: Treating the Great Depression as a purely American event, or failing to connect its economic desperation directly to the political rise of totalitarian movements in the next unit.