Secretary of the Treasury Andrew Mellon advised President Hoover that shock treatment would be the best response: “Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate…. That will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people.” Hoover rejected this advice, and started numerous programs, all of which failed to reverse the downturn.
Between 1929 and 1932 the income of the average American family was reduced by 40%.
Nine million savings accounts had been wiped out between 1930 and 1933
Over 60% of Americans were categorized as poor by the federal government in 1933.
Over one million families lost their farms between 1930 and 1934
From the years 1929 to 1932, about 5,000 banks went out of business.
By 1933, 11,000 of the US’ 25,000 banks had failed
Between 1929 and 1933, U.S. GDP fell around 30%, the stock market lost almost 90% of its value.