Part 2 Chapter 18 Midget Summary and Analysis

The stock market hits bottom in July, 1932. Unemployment is at its highest point in the nation. Hoover will not break with orthodox economic policies to bring the nation out of the Depression, preferring instead to balance the budget by raising taxes. In 1932 the Reconstruction Finance Corporation comes into being to make loans to banks, railroads and other businesses. This aids the House of Morgans by allowing the Van Sweringen brothers to borrow $75 million. Lamont and his wife sail on an Aegean cruise. "If the Morgan world seemed to survive the Depression intact, the surface was deceptive. Between 1929 and 1932, the bank saw its net worth - its basic capital cushion - drop with frightening speed, from $118 million to half that before Hoover left office. Total assets plunged from $704 million to $425 million. Even for the House of Morgan, these...