In late October, 1929, the New York Stock Market crashed with a 15% drop.  The worldwide economy began to spiral downward into the Great Depression.  President Hoover viewed this as a lack of confidence in the financial system.  Thus, it was the fundamental economic problem facing the USA.  His response to this Great Depression was widely seen as lackluster.  He sought to avoid direct federal intervention, believing that the best way to bolster the economy was through the strengthening of businesses such as banks and railroads.  He attempted to put a positive spin on Black Tuesday.  In the days following Black Tuesday, the Federal Reserve announced that it would cut interest rates.  At the same time, Hoover opposed congressional proposals to provide federal relief to the unemployed, as he believed that such programs were the responsibility of state and local governments and philanthropic organizations.  Herbert Hoover had taken office hoping to raise agricultural tariffs to help farmers reeling from the farm crisis of the 1920s, but his attempt to raise agricultural tariffs became connected with a bill that broadly raised tariffs on all goods.  President Hoover felt that he could not reject the main legislative accomplishment of the Republican-controlled 71st Congress, so he signed the Smoot–Hawley Tariff Act into law in June 1930.  The result was that Canada, France, and other nations retaliated by raising tariffs, resulting in a contraction of international trade and a worsening of the world and USA economy.  A series of bank failures in late 1930 heralded a larger collapse of the economy in 1931.  While other countries left the gold standard, Hoover refused to abandon it.  By mid-1931, the unemployment rate had reached 15%, giving rise to growing fears that the country was experiencing a depression.  Hoover allowed his opponents in the Democratic Party to define him as cold, incompetent, reactionary, and out-of-touch.  While Hoover continued to resist direct federal relief efforts, Governor Franklin D. Roosevelt of New York launched the Temporary Emergency Relief Administration to provide aid to the unemployed. Democrats positioned this program as a kinder alternative to Hoover’s alleged apathy towards the unemployed.  The economy continued to worsen, with unemployment rates nearing 23% in early 1932.  Hoover finally heeded calls for more direct federal intervention.  In January 1932, he convinced Congress to authorize the establishment of the Reconstruction Finance Corporation, which would provide government-secured loans to financial institutions, railroads, and local governments.  The same month the RFC was established, Hoover signed the Federal Home Loan Bank Act, establishing 12 district banks overseen by a Federal Home Loan Bank Board, like the Federal Reserve System.  He also helped arrange passage of the Glass–Steagall Act of 1932, an emergency banking legislation designed to expand banking credit by expanding the collateral on which Federal Reserve banks were authorized to lend.  As these measures failed to stem the economic crisis, Hoover finally signed the Emergency Relief and Construction Act, a $2 billion public works bill, in July 1932.  National debt as a fraction of GNP went up from 20% to 40% under President Hoover.  He wanted to tax high earners at a 63% rate on their net income.  He doubled the top estate tax rate, cut personal income tax exemptions, eliminated the corporate income tax exemption, and raised corporate tax rates, but the USA still had a deficit.  Then President Hoover lost to Roosevelt in November, 1932.  What do you know about the Great Depression?