John Moser

Prices were going down.

Hoover's thought was this is going to cause a burst of consumption.

That's going to save the economy.

And it didn't do it.

Your average worker who was lucky enough to have a job between 1929 and 1933 was

had more money than they had before because their wages were the same, but prices were going down.

So in real terms, they were doing better, but that didn't give them the confidence to spend it.

They put that money aside rather than risk it on some major purchase like a car or a refrigerator or anything like that.

In certain areas, of course, these were areas that had been struggling even before this point.

For instance, New England textiles.

Yes.

Had been in bad shape.

Coal mining was already starting to suffer even before the depression started.

So you had serious systemic unemployment in those areas that as the economy started to fail, they did worse, obviously.

Yeah.

And corporations, they kept their wages high, but at the same time, they said, look, we don't have as much work as we did.

So they did lay off people.

But that's been said for a while.

Most economists today don't accept that inequality had a lot to do with the start of the problem.

Consumption was doing very well until the crash.