Why did the Democrats feel that they couldn't win the 1928 election? The 1920's had brought properity for most Americans and big business. The stock market was booming and the economy appeared to be strong.

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That's about right!  Indeed, at 1928, the American social and economic orders did not seem to be stopping.  The economic prosperity of the decade was present and there was little belief that the engine could stop or would come to a screeching halt.  Usually, during periods of economic prosperity and social optimism, a change in party leadership is not readily visible.  Certainly, the Democrats of the time period probably felt this.  It was difficult to see the need for change present from the voting public.  Democrats felt that the Republicans and, in particular, Hoover would continue to ride the economic prosperity train.  While this was true, it was also short sighted, myopic in its understanding that in only a year from this point, the economic boom would come to a crashing halt.

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Well, you pretty much just answered your own question with the stuff that you put in the second box.

People who pay attention to presidential elections know that the incumbent president (or his party) just about always win elections when the economy is going well.  They almost always lose when the economy is bad.  That is because people tend to think that the President has control over whether the economy is good or bad.

So, the voters gave the Republicans credit for the booming economy and the Democrats did not think they had much of a chance to win.

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