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Economic Growth Of A Recession
A recession can be defined as an economic decline in gross domestic product, in which, a nation experiences a downward sloping growth rate.
Additionally, recessions tend to have a time range of two or more periods/quarters of falling real gross domestic product (GDP), consequently
from the negative sloping economic growth rate. In order to properly define causal factors of a recession, it is most appropriate to elucidate what
GDP's meaning. GDP = I + C + G + NE GDP provides a monetary value of all final goods and services produced within a nation in a particular year.
The independent variables make up the GDP, which is comprised of the sum of investments, consumption, government spending, and net exports. A
strong GDP is a good representation because it indicates a nation's viability. It is rather pertinent for a nation to be able to forecast the economy and
know where along the business cycle the economy is headed. There are multiple macroeconomic indicators that are analyzed to make lucid a nations
economic condition, such as foreign direct investments, oil prices, and employment. In this paper, we will be analyzing the causal relationship
between interest rates and recessionary periods, pertaining particularly to The Russian Federation. Based on the graph below (See Russian GDP
Growth), one can discern that Russia began to experience fluctuation in their GDP at the start of 2008. Zeliko Bogetic states in the article Russia:
Reform After the Great Recession, this
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Increases in government spending financed by borrowing may hinder a strong recovery during a severe recession. Let us start by discussing why does
the government spending increase during recession? Firstly, because the economy goes into recession, many workers loose their jobs and at the same
time the corporate profits decline. As a result the income tax revenues for the government decline. Secondly, because several workers have lost their
jobs, this results in the increase in the use of government supplement programs to help them out in their difficult times. Thirdly, to help the perturbed
workers, the government creates new "social" programs during such times. Thus the government spending rises. It rises not just because of the increased
...show more content...
Thus some government spending is necessary for the successful economic conditions. Examples of good government spending would be maintaining
the legal system which can have a high rate of return. However in general the government doesn't use the financial resources effectively. It promotes
economically abominable decisions. The welfare programs encourage people to remain unemployed. Flood insurance programs encourage people to
construct buildings and residences in high probability flood areas. These and other such programs reduce economic growth if the government borrows
money and spends on them. For every dollar the government spends, it translates to one less dollar in the productive sector of the economy. In other
words this slows down the growth since the political forces dominate how the money is spent. In summary, Governments should not be allowed to
borrow during recession. The disadvantage being that the government can use this money in an inefficient measure. Non–availability of borrowing
power would force the government to make sound economical decisions during a recession and not move into the next
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Great Recession Research Paper
An economic recession occurs when the economy is suffering, and unemployment is on a rise. A drop in the stock market and a decrease in the
housing market will also affect the economy due to a recession. Higher interest rates affect the economy constrain liquidly or the cash available to
invest in stocks and businesses. Inflation alludes to the rise in prices of goods and services which also puts a strain on the economy further adding
to a recession. Businesses were lost and consumer spending dwindled the only category that remained safe was healthcare. The economic meaning of
a recession is a decline in the Gross Domestic Product (GDP) consisting of two consecutive quarters on a decline. If the economy is bad consumers
are less likely to spend money on goods and service. The effects of a declining economy forced the government to create monetary...show more
content...
The demand side policies did not prevail in completely taking out the serious impacts of the economic downfall. During the great depression,
unemployment rates skyrocketed, and businesses crumbled. Consumer spending decreased. During the great depression, fiscal and monetary policies
were implemented by the Federal Reserve System in response to the economic decline. With the implementation of these policies stimulus packages
were also put into place in February of 2008. The Economic Stimulus Act of 2008 contributed to over billions of dollars towards tax rebates to
families in the United States. Tax rebate checks were sent out to families both lower and middle–class Americans. The effects of the stimulus package
were significantly increasing the GDP and lowering the unemployment and adding jobs. Another success because of the polices was the real estate
equity on housing which went up significantly (Reed, n.d.). Without these fiscal policies, the economy would continue to decline and unemployment
would be on a
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The 2008 Financial Crisis Essay
Introduction
In 2008, the world experienced a tremendous financial crisis which rooted from the U.S housing market; moreover, it is considered by many
economists as one of the worst recession since the Great Depression in 1930s. After posing a huge effect on the U.S economy, the financial crisis
expanded to Europe and the rest of the world. It brought governments down, ruined economies, crumble financial corporations and impoverish
individual lives. For example, the financial crisis has resulted in the collapse of massive financial institutions such as Fannie Mae, Freddie Mac, Lehman
Brother and AIG. These collapses not only influence own countries but also international area. Hence, the intervention of governments by changing and
...show more content...
The economy is known as a new emerging economy especially after entering WTO in 2007. The Foreign Direct Investment (FDI) has increase
considerably and the GDP is over 8% in the period of three years (2005–2007). Nonetheless, it is clear that the economic instability occurs after WTO
accession of Vietnam 1 year. Consequently, the economy has suffered surginginflation as well as trade and fiscal deficit. (Figure 1) GDPCPI
20058.48.3
20068.27.5
20078.58.3
20086.223
20095.36.9
Figure 1 : GDP and CPI 2005–2009 (% change per year)
Source: Asian Development Bank and Vietnam
B. Inflation
Inflation doubled in 2007 and reached a peak at 28% in 2008.The fiscal make up 4–5% GDP and the trade deficit accounted for 20% GDP in which
approximately $US17.5 billion dollars. The influence of high fuel combine with food prices and high domestic demand lead to high inflation. The high
price of fuel in Vietnam illustrates global fuel prices and the high domestic demand of country importing fuel. Furthermore, the increase in global food
prices affect detrimental to the high inflation in Vietnam.(Figure 2) Figure 2 : Fiscal Deficit and Trade Deficit (2003–2008)
Source : IMF, General Statistics Office of Vietnam
C.Impact on Trade
The global financial crisis has affected severely on Vietnamese exports. After joining the WTO, Vietnam's trade has become depend on global
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Part 8 – A recession is typically defined as at least two consecutive quarters of economic decline in GDP. When this happens, unemployment tends to
rise, personal income may drop, and the price of goods and services become volatile. Most agree that it is impossible to eliminate recession in a
capitalistic economy, since it is so cyclic. Recessions may trim weak business and allow stronger ones to survive by employing techniques that improve
quality and service. Recession does not mean depression; it simply means that there are peaks and valleys within the overall economic system. Now
that economies are more global though, these dips have a far more reaching set of consequences. In most firms, however, recession may result in some
lay–offs, but it also may mean greater attention to sustainability, cost–cutting, and a more lean and strategic approach to the individual product or
service (Moffatt, 2009).
Part 9 – The Federal Reserve System was created in 1913 to act as the central bank of the United States and to oversee the nation's monetary policy,
regulate banking, and make financial systems stable. Over the past two years, though, the Fed has faced serious challenges as it responded to severe
recessionary times. The TARP program was a new tool to provide capital to banks, as well as new programs to stabilize money market mutual funds
and short term paper markets. TARP and TALF (Term Asset
–Backed Securities Loan Facility) helped revive security markets and allow more
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Recession In America
The single greatest problem facing America today would be the threat of a Recession in the stock market. Because if America goes in to
Recession again the stock market will crash again. Then we would not need to worry about this stupid war because we will be broke. With gas and
other items prices going up it is getting harder to live. "Prices going up and money running out" that's what the old people used to say. It is just
getting harder to live. When people in their forties were young they could buy groceries for a week with twenty dollars, now you spend half your
paycheck. Now a days people go out every day and get fast food full of fat, they eat that garbage for a year then they start getting fat and lazy. Next
thing you now they
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Essay On The United States Recession
After I got the assignment and read what the topics were, I started doing research on all the topics you gave us. After doing the research I decided I
was most interested in the United states recession in 2008. It also interested me in finding out what we have done, in the middle of doing, and
what we are going to do to get out of the recession. I decided to choose this topic about the US economy and what we were and are doing to get out
of the recession because I wanted to learn more about why we went into a recession and how we are now working on how to get out of one. I
wanted to write about all the things that led up to the recession and write about what we are doing and going to do to fix the recession. I started off by
finding a lot...show more content...
The effects from the great recession made people lose jobs which didn't help the recession any, it also made prices go up on things that people
could not live without like gas, water, power, food, oil, clothing, etc., decrease in shipping orders which is what helped all the prices rise because it
made a shortage in items that people needed to live, and the financial markets decrease greatly, which always causes everyone to go into mass
hiseriahysteria because the stock markets "crash". . I learned that president Obama started to fix the recession by stopping the war in Iraq because it
was costing the us ten billion dollars a month. Also, he got them to stop spending fifteen million in overpayment to Medicaid and Medicare and start
working on stopping the fraud. I learned that Baraka Obama stopped the recession. Amadeo said, "President Barack Obama outlined the economic
stimulus package during his 2008 campaign. Congress approved the $787 billion American Recovery and Reinvestment Act in February 2009." The
economic stimulus package ended the Great Recession by spurring consumer spending. Its goal was to save between 900,000 to 2.3 million jobs. The
economic stimulus plan was intended to spend $185 billion in 2009 and it ended a four–quarter decrease in GDP by the second from last quarter in
2009. After completing my outline, I started writing my paper. While I was writing I realized I needed to add more into the paper. So, I done a little
more research and
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Global Economic Recession Essay
An economic recession is described as "a widespread decline in the GDP and employment and trade lasting from six months to a year." (Word Net)
The economic recession is an international problem that has been affecting countries like the United States, China, United Kingdom and others for
over two years. The latest recession began when house prices and sales began to fall and large drop offs in business investments started. Another
causing factor of the recession was citizens with bad credit buying houses and real–estate and mortgages not being paid. Countries began taking action
in 2008 by implementing stimulus packages and bailout plans, which can help a country locally, federally and on a global scale. The United States
stimulus...show more content...
With the 2009 stimulus package, the focus shifted from bailouts and large sums of money given to corporations, but too investing in infrastructure,
health and other public services.
In the 2009 stimulus package, $111 billion was set aside for infrastructure only. This includes federal buildings, municipal buildings, municipal
recreational structures, roads and bridges and several other areas of construction (Hossain, and Cox). Money was also invested into social services,
including education, where $53 billion has been dedicated to. This money has gone straight into schools that need some extra funding to remain
open, and to prevent cuts in staff. This way, the level of education remains high, whereas schools closing would cause dropout rates to be higher,
and averages to be lowered. In 2009, the US government also invested $87 billion into several States to cover Medic Aid costs (Hossain, and Cox).
The government has also investing large amounts of money to repair roads, highways, rail ways and important bridges. Another focus for the US
government is to make public transit easier to access for the public to cut down on citizens driving to work every day.
Recently a large focus for countries in economic recession, namely the United States, has been to begin a new green initiative. In the United States, a
large amount of money has
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The business cycle is the short–run alternation between economic downturns and economic upturns (Investopedia n.d.). A recession is an economic
downturn and happens in every country and some recessions are worse than others and the output of GDP and employment are falling farther and
faster. The great depression lasted from 1929–1933 and was a deep prolonged downturn in the business cycle before a recovery/expansion of the
business cycle occurred and GDP and employment started to rise (Krugman & Wells. 2012). The nextrecession lasted from 1981–1982 and was
comparatively smaller than the first (Krugman & Wells. 2012). More recently in 2001 a slump in the economy was noted and was followed by the
great rescission of 2007–2009 (Krugman &...show more content...
An examples of the circular cash flow model is demonstrated in figure 21–6.
"Firms produce output and then pay income to households and households then use this income to buy goods expenditure" (Pettinger. n.d.).
Unemployment Rate & Labor Force Participation Rate Labor force is the amount of people who are employed and currently have a job and the
people who are unemployed and currently do not have a job (Krugman & Wells. 2012). The labor force participation rate is calculated with people
sixteen years of age and older that are employed, while the unemployment rate is measured by the percent of the total number of people sixteen
years of age and older who do not have a job (Krugman & Wells. 2012). The United States assigns the Bureau of Labor Statistics (BLS) with the
task of tracking the employment and unemployment rate of the labor force in the United States (BOOK). The BLS breaks down the unemployment
and labor rate much farther than just how many are working and not working and breaks the cart down to race, age, gender, and level of schooling
from no high school diploma to bachelors degree and higher for the year along with many other statistics and ways to track the populations work
force (U.S. Bureau of Labor Statistics. n.d.). The BLS breaks down the labor force also by including discouraged workers, who are people that are not
working but could work and have given
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Economic Recessions : The Great Depression
Economic recessions have been around for years and are very unpredictable for anyone can be affected by these economic downfalls. They had an
impact on society for decades, and the effects of these economic recessions are still felt to this day. There have been more than forty seven known
recessions that have occurred in this country over the years, and are a major part of American history. Although economic recessions are a natural
hardship that the government and its citizens will encounter at some point in time lasting about only six months, the most famous and well– known
recession that had happened in this country would be The Great Depression. The Great Depression, one of the worst economic depressions in the
history of the industrialized world, lasted from 1929 to 1939. It began when the stock market crashed in October 1929, which resulted in millions of
investors losing their jobs. As a result, consumer spending and investment had dropped, and by 1933 the country was at its lowest point and millions
of Americans were left unemployed also half of the country's banks had failed. During this time of crisis, average American citizens had undergone
many obstacles just to survive and to feed their families. With that being said, living everyday life was a struggle for most Americans.
The Great Depression was the first to develop a large urban middle class. Families who depended on wage income and who believed that the
necessities of life included not only food and
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Effects Of Recession On The United States Essay
Have you ever wanted explore at time other than the one you lived? I choose to analyze the July 1990–March 1991 recession that lasted for 8 months.
Recession can occur at any point in time and can have a number of causes. In this paper, I will talk about what caused this recession, fiscal policy,
monetary policy and end with recovery and expansion.
II.Causes of recession
There can be many causes of recession. In this case, the July 1990 through March 1991 recession was caused by a change in both, aggregate demand
and aggregate supply. One of the causes during the recession was a decline in expectations about future income and wealth. The decline of consumer
and business confidence leads to lower expectations, which will decrease aggregate demand.
Then there was a change in factor of production prices which caused aggregate supply to change. The second cause of the 1991 recession, was an
increase in oil prices, after the Iraq invasion of Kuwait. The input prices of oil increased, which would cause aggregate supply to decrease.
Furthermore, the Federal Reserve lowered the rate of inflation which slowed economic growth.
Lastly, after the baby boomers there was a slowing in the population growth rate.
The unemployment rate leading up to the 1991 recession was much smaller than it was during the recession its self. In 1989 the unemployment rate
stayed close to its average of 5%, with the greatest percent being 5.4%. In 1990, it stayed about the same until the
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The Economic Recession of 2008 Essay
Ever since the Recession of 2008, the process of acquiring employment has become extremely challenging and exhausting. After months of
searching, a significant amount of job seekers are willing to accept any job offers that will allow them to put food on the tables. If you follow the
United States' economic recovery, you probably know that there are about 10.5 million unemployed Americans and constant debates about how to
create more jobs. What you may not know is that there are actually four million open jobs waiting to be filled. So how is it possible and who is
there to blame? First, in order to better understand the scale of the problem let's take a closer look at the numbers. Since late 2007, nearly 8.5 million
jobs were lost; in...show more content...
Let's look at all of them and see why they do not always work. Online job search engines are not being a lot of help these days. Oftentimes the only
people you will hear back from would be scammers and employment agencies seeking to make money on potential hires. After posting a resume on
such web sites, there is a high chance that you will receive hundreds of emails offering work from home, or immediate job opportunity. Further
research on the company will uncover numerous complaints or scam alerts. When it comes to applying through a corporate web site, there is one
thing to be aware of: companies these days use help of automated resume scanners. With competition being as high as it is, one job listing attracts
hundreds, if not thousands of job applications. In order to sort them out, corporations utilize special software that scans resumes for specific key
words. Even though it makes the process a lot faster and easier, the automated systems won't necessarily recognize even the best candidate. With market
being on their side, employers also take their time when making hiring decisions; job–seekers are subjected to multiple interviews, screening and tests.
Since the process takes too long, the best candidates might move on long time before company makes up its mind. Job
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The Great Us Economic Recession
THE GREAT US ECONOMIC RECESSION Introduction Did you know that by the end of the year 2009 the unemployment rate had increased
from its average 5% to an astounding 10%? This is because 15.3 million people became unemployed as a result of the economic recession. No
shocker, but poverty rate had also increased from 13.2% in 2008 to 14.3% in 2009. This meant that the number of people living in poverty in the
United States had increased from 39.8 million to 43.6 million. This great increase had all happened in the span of 1 year. Something that should
have taken over 10 years only took 1 year and this is all because of the Great US recession. Also the US suicide rate had reached its highest record since
25 years between the years 2008–09. The great US recession was a result of foolish decisions made in the past, which then in turn lead to a slow and
painful punishment for the US economy. It was caused mainly because banks were loaning out too much money; Banks used money which they
didn't really have on paper to invest heavily into the housing market and the stock market; the debts which the citizens were creating by using large
amounts of loans to pay for their daily expenses and to pay for expensive things became impossible to pay. Banks were loaning out too much money
If you google when the US recession began it will answer 2007. So the better question would be when did it start to develop, because something so
grand could not just have been made overnight. The answer to
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Economic Impact Of The Great Recession
This paper will be defining the 2008 great recession and the economic impact which the United States wasn't aware of. The great recession affected
various businesses and others forced to increase prices or close doors immediately. Fiscal and monetary policies will also be discussed briefly in detail
knowing the differences and determining the best course of action. Lastly will be implementing possible solutions to fix the economic problem and
prevent any future recessions that could pose a devastating impact to economy. 2008 Great Recession Involvement The Great Recession was best
known during the late President Bush into Obama era. Great Recession defined as; the economic slump began when the U.S. housing market went
from boom to bust and large amounts of mortgage–backed securities and derivatives lost significant value (Investopedia.com). As the housing market
was crashing, houses and business buildings have become vacant which the per capita rate for many cities dropped. The issue forced gas prices and
goods to increase to make up for the loss per capita rate percentage. The economy doesn't see the big picture when prices rise and interest decreases,
hurting, value and profits within businesses throughout country continue bringing down markets. Take Johnstown Pennsylvania for example; the city
was known for the leading steel manufacturing companies. With the market declining with facts from 2000–2010 census data, Johnstown Pennsylvania
has lost over 5 % of
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Economic Recession
Economic Recession of 2007
William Mwangi
Class title and section
Professor's name
Due date of Assignment: 26th August 2011.
William Mwangi
Economic crisis Class
Professor's name
24th August, 2011.
Economic Recession of 2007: What caused it and what were the after effects? Can we predict another major recession?
Thesis Statement: Although the recession that dates back in 2007 is still long and deep and surely has shown some recovery, the potential that it will
completely recover is still vague.
I.Causes of the 2007 recession
A.Inflation
B.Housing Prices
C.Oil Prices
–Recovery measures
A.Cutting Production cost
i.Caused unemployment
B.Increase Interest rates by the Federal reserves
i....show more content...
Current Account Deficit," he explained that economic crisis has its background way back – a decade ago, as the developing countries had modest trade
and account deficit of which was financed by borrowing from the rest of the world in order to invest more than save, bringing about financial crisis i.e.
they will be rich in future by constructing infrastructures but face recession in present.
Housing prices was another contributing cause to the recession. In the decade going towards 2006, housing prices spiraled up by more than 25%
due to high demand, decline in lending standards, and low interest rates in the 2000s. Between 2000 and 2006 large number of borrowers took out
mortgages as they were lured by the prevailing favorable rates. This had the effect of fetching all and sundry including those individuals with bad
credit records. The Federal Reserve began to raise fed funds thus interest rates cropped from 1.25% to 5.25% – a reasonable level to fight the inflation
level as well as overall loans between banks. Expensive repayment on loan had the effect of softening housing markets since borrowing was costly.
According to Bernanke, "by August 2007, nearly 16% of mortgages were in default," (qtd. In Jones 6) this explains the advancement in the problem
due to low housing prices that led to defaults and further lowered housing prices even further in a vicious cycle. In addition,
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Growing Up From An Economic Recession
Growing up in Ghana in the early to mid–nineties was very challenging for me and most people I came into contact with; yet provided the acumen to
make sound personal and professional decisions. Ghana was recovering from an economic recession mainly attributed to series coup d'Г©tats that
destabilized the economy and crippled most state institutions. As a result of this, the country experienced a protracted period of serious economic
decline characterized by lax financial management, inflation rates well over 40%, extensive government involvement in the economy and an extremely
high budget deficit. These weak macroeconomic fundamentals influenced the government's decision to implement a series of strenuous public policies;
with the goal to place Ghana back on sound economic and social footing.
I woke up one morning to prepare for school; however, I realized that the airwaves were filled with anger. Most people in my neighborhood were glued
to their radio sets, waiting impatiently on the government to confirm the rumors, about its decision to replace the current sales tax rate with a new one;
the Value Added Tax
. Around midday, the government finally announced its decision to amend the tax system and outlined in detail various segments
of the new tax policy. Under the new tax structure, taxes will be levied on every supply of goods and services made in Ghana, every importation of
goods into the country and the supply of any imported service. The new tax system is meant to
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Inflation And The Great Recession
From the results, the effect inflation had on the savings, made the total price required to purchase the car increase by nearly $2,000 in three years.
The new monthly repayments increased by $51.50 per month over a three year time period. These increases due to inflation are realistic, as a three per
increase over three years isn't much.
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Economic Recession in India
National Conference
On
GLOBAL MELTDOWN
Issues, challenges& strategies
At
Institute of Management & Technology, Faridabad
Economic Recession in India and
Survival strategies
(Technical Session III)
Kavita Verma
DAV Centenary College,
Faridabad
Verma_ruby123@rediffmail.com
OBJECTIVES OF THE STUDY
To study the impact of recession on Indian economy
I.Positive Impact
II.Negative Impact
To study the survival strategies for
1.Individual
2.Investor
3.Employee
4.Employer
THE RECESSION
India is facing the position of recession as globalization showing its negative scenario. As it was started in US and now it's touching the boundary of
India also. Recession is a phase in which rupee depreciate, cash crunches, money market slowdown, inflation...show more content...
Prepare your expenditure chart daily. Instead of retrenchment, change the salary package. Motivate your employees for doing hard work. Convince
them for long working hour. To reduce the risk, segment your market. Daily calculate the inflow and outflow of cash from the organization. Keep in
touch the changes government made in economic policy.
INTRODUCTION TO RECESSION
Every day we find newspaper is filled with headlines Recession. Share market is falling, inflation is coming, interest rates are falling, and all are
together working to grasp a human being. An economy which grows over a period of time tends to slow down the growth as a part of the normal
economic cycle. This is known as recession.
As it was started in US after giving loans to sub prime market, now it covering the boundry of India also.
The falling economy of US will affect the Indian economy. As the recession starts, Indian person starts taking their money from market, without
considering the other side of coin.
Credit crisis in America will effect our inflows, exports are effected badly and my more.
Financial Crisis and Impact on India
Actually the financial crisis was originated in the US. This was started when Banks in US started giving home loan to sub–prime market with a hope of
getting good return.
And the return actually return was very good. With stock markets booming and the system flush with liquidity, many big fund investors like hedge
funds and
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Essay about U.S. Economy
The United States economy is currently not looking very good. Over the past couple of months the economy has taken a turn for the worst and we
could be headed into a recession in the coming months or years. The biggest problems are in the real estate and mortgage markets. In 1999, housing
prices rose at huge rates and lenders began offering riskier mortgages, which caused homeowners to keep piling up huge debts. People were taking out
loans and balloon mortgage payments that they really could not afford. The problem began in late 2007, when housing prices began to fall and the
system fell apart causing huge numbers of defaults on home loans and foreclosures. Currently, 5.6% of mortgages are delinquent, the highest rate in 21
years, and...show more content...
The housing crisis that I mentioned earlier and resulting backlash through the entire economy has been building for awhile now but it has just came
into the forefront in the past couple of weeks. We really haven't faced a downturn like this since the Depression. Last Tuesday, January 22, the Dow
Jones industrial average fell almost 600 points and was already down 9% in 2008 (Gross 1). Immediately the Federal Reserve took action and cut the
interest rates three–quarters of a percentage point, the biggest cut in 24 years. Today, not even a week later, the Fed again cut interest rates, this time
by a half–point (Aversa 1). This move is an effort to keep the economy out of a recession by getting money back into the banks and encouraging
them to keep lending credit to turn the economy upward. Whether or not it will work remains to be seen in the coming months. The government
also announced another move to a couple weeks ago to help get the economy going again and avoid or slow down a recession. President Bush and
the House are currently developing a $145 billion stimulus plan that would give tax relief to citizens by sending them individual checks for $300 and
up. The plan would put over $100 billion into the hands of consumers and the government hopes that money would be spent and put back into the
economy (Wolf 1). While all these things are good news for the struggling economy, most economic experts believe that a recession of some kind may
be impossible to avoid
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Economic Growth Of A Recession

  • 1. Economic Growth Of A Recession A recession can be defined as an economic decline in gross domestic product, in which, a nation experiences a downward sloping growth rate. Additionally, recessions tend to have a time range of two or more periods/quarters of falling real gross domestic product (GDP), consequently from the negative sloping economic growth rate. In order to properly define causal factors of a recession, it is most appropriate to elucidate what GDP's meaning. GDP = I + C + G + NE GDP provides a monetary value of all final goods and services produced within a nation in a particular year. The independent variables make up the GDP, which is comprised of the sum of investments, consumption, government spending, and net exports. A strong GDP is a good representation because it indicates a nation's viability. It is rather pertinent for a nation to be able to forecast the economy and know where along the business cycle the economy is headed. There are multiple macroeconomic indicators that are analyzed to make lucid a nations economic condition, such as foreign direct investments, oil prices, and employment. In this paper, we will be analyzing the causal relationship between interest rates and recessionary periods, pertaining particularly to The Russian Federation. Based on the graph below (See Russian GDP Growth), one can discern that Russia began to experience fluctuation in their GDP at the start of 2008. Zeliko Bogetic states in the article Russia: Reform After the Great Recession, this Get more content on HelpWriting.net
  • 2. Increases in government spending financed by borrowing may hinder a strong recovery during a severe recession. Let us start by discussing why does the government spending increase during recession? Firstly, because the economy goes into recession, many workers loose their jobs and at the same time the corporate profits decline. As a result the income tax revenues for the government decline. Secondly, because several workers have lost their jobs, this results in the increase in the use of government supplement programs to help them out in their difficult times. Thirdly, to help the perturbed workers, the government creates new "social" programs during such times. Thus the government spending rises. It rises not just because of the increased ...show more content... Thus some government spending is necessary for the successful economic conditions. Examples of good government spending would be maintaining the legal system which can have a high rate of return. However in general the government doesn't use the financial resources effectively. It promotes economically abominable decisions. The welfare programs encourage people to remain unemployed. Flood insurance programs encourage people to construct buildings and residences in high probability flood areas. These and other such programs reduce economic growth if the government borrows money and spends on them. For every dollar the government spends, it translates to one less dollar in the productive sector of the economy. In other words this slows down the growth since the political forces dominate how the money is spent. In summary, Governments should not be allowed to borrow during recession. The disadvantage being that the government can use this money in an inefficient measure. Non–availability of borrowing power would force the government to make sound economical decisions during a recession and not move into the next Get more content on HelpWriting.net
  • 3. Great Recession Research Paper An economic recession occurs when the economy is suffering, and unemployment is on a rise. A drop in the stock market and a decrease in the housing market will also affect the economy due to a recession. Higher interest rates affect the economy constrain liquidly or the cash available to invest in stocks and businesses. Inflation alludes to the rise in prices of goods and services which also puts a strain on the economy further adding to a recession. Businesses were lost and consumer spending dwindled the only category that remained safe was healthcare. The economic meaning of a recession is a decline in the Gross Domestic Product (GDP) consisting of two consecutive quarters on a decline. If the economy is bad consumers are less likely to spend money on goods and service. The effects of a declining economy forced the government to create monetary...show more content... The demand side policies did not prevail in completely taking out the serious impacts of the economic downfall. During the great depression, unemployment rates skyrocketed, and businesses crumbled. Consumer spending decreased. During the great depression, fiscal and monetary policies were implemented by the Federal Reserve System in response to the economic decline. With the implementation of these policies stimulus packages were also put into place in February of 2008. The Economic Stimulus Act of 2008 contributed to over billions of dollars towards tax rebates to families in the United States. Tax rebate checks were sent out to families both lower and middle–class Americans. The effects of the stimulus package were significantly increasing the GDP and lowering the unemployment and adding jobs. Another success because of the polices was the real estate equity on housing which went up significantly (Reed, n.d.). Without these fiscal policies, the economy would continue to decline and unemployment would be on a Get more content on HelpWriting.net
  • 4. The 2008 Financial Crisis Essay Introduction In 2008, the world experienced a tremendous financial crisis which rooted from the U.S housing market; moreover, it is considered by many economists as one of the worst recession since the Great Depression in 1930s. After posing a huge effect on the U.S economy, the financial crisis expanded to Europe and the rest of the world. It brought governments down, ruined economies, crumble financial corporations and impoverish individual lives. For example, the financial crisis has resulted in the collapse of massive financial institutions such as Fannie Mae, Freddie Mac, Lehman Brother and AIG. These collapses not only influence own countries but also international area. Hence, the intervention of governments by changing and ...show more content... The economy is known as a new emerging economy especially after entering WTO in 2007. The Foreign Direct Investment (FDI) has increase considerably and the GDP is over 8% in the period of three years (2005–2007). Nonetheless, it is clear that the economic instability occurs after WTO accession of Vietnam 1 year. Consequently, the economy has suffered surginginflation as well as trade and fiscal deficit. (Figure 1) GDPCPI 20058.48.3 20068.27.5 20078.58.3 20086.223 20095.36.9 Figure 1 : GDP and CPI 2005–2009 (% change per year) Source: Asian Development Bank and Vietnam B. Inflation Inflation doubled in 2007 and reached a peak at 28% in 2008.The fiscal make up 4–5% GDP and the trade deficit accounted for 20% GDP in which approximately $US17.5 billion dollars. The influence of high fuel combine with food prices and high domestic demand lead to high inflation. The high price of fuel in Vietnam illustrates global fuel prices and the high domestic demand of country importing fuel. Furthermore, the increase in global food prices affect detrimental to the high inflation in Vietnam.(Figure 2) Figure 2 : Fiscal Deficit and Trade Deficit (2003–2008) Source : IMF, General Statistics Office of Vietnam C.Impact on Trade The global financial crisis has affected severely on Vietnamese exports. After joining the WTO, Vietnam's trade has become depend on global
  • 5. Get more content on HelpWriting.net
  • 6. Part 8 – A recession is typically defined as at least two consecutive quarters of economic decline in GDP. When this happens, unemployment tends to rise, personal income may drop, and the price of goods and services become volatile. Most agree that it is impossible to eliminate recession in a capitalistic economy, since it is so cyclic. Recessions may trim weak business and allow stronger ones to survive by employing techniques that improve quality and service. Recession does not mean depression; it simply means that there are peaks and valleys within the overall economic system. Now that economies are more global though, these dips have a far more reaching set of consequences. In most firms, however, recession may result in some lay–offs, but it also may mean greater attention to sustainability, cost–cutting, and a more lean and strategic approach to the individual product or service (Moffatt, 2009). Part 9 – The Federal Reserve System was created in 1913 to act as the central bank of the United States and to oversee the nation's monetary policy, regulate banking, and make financial systems stable. Over the past two years, though, the Fed has faced serious challenges as it responded to severe recessionary times. The TARP program was a new tool to provide capital to banks, as well as new programs to stabilize money market mutual funds and short term paper markets. TARP and TALF (Term Asset –Backed Securities Loan Facility) helped revive security markets and allow more Get more content on HelpWriting.net
  • 7. Recession In America The single greatest problem facing America today would be the threat of a Recession in the stock market. Because if America goes in to Recession again the stock market will crash again. Then we would not need to worry about this stupid war because we will be broke. With gas and other items prices going up it is getting harder to live. "Prices going up and money running out" that's what the old people used to say. It is just getting harder to live. When people in their forties were young they could buy groceries for a week with twenty dollars, now you spend half your paycheck. Now a days people go out every day and get fast food full of fat, they eat that garbage for a year then they start getting fat and lazy. Next thing you now they Get more content on HelpWriting.net
  • 8. Essay On The United States Recession After I got the assignment and read what the topics were, I started doing research on all the topics you gave us. After doing the research I decided I was most interested in the United states recession in 2008. It also interested me in finding out what we have done, in the middle of doing, and what we are going to do to get out of the recession. I decided to choose this topic about the US economy and what we were and are doing to get out of the recession because I wanted to learn more about why we went into a recession and how we are now working on how to get out of one. I wanted to write about all the things that led up to the recession and write about what we are doing and going to do to fix the recession. I started off by finding a lot...show more content... The effects from the great recession made people lose jobs which didn't help the recession any, it also made prices go up on things that people could not live without like gas, water, power, food, oil, clothing, etc., decrease in shipping orders which is what helped all the prices rise because it made a shortage in items that people needed to live, and the financial markets decrease greatly, which always causes everyone to go into mass hiseriahysteria because the stock markets "crash". . I learned that president Obama started to fix the recession by stopping the war in Iraq because it was costing the us ten billion dollars a month. Also, he got them to stop spending fifteen million in overpayment to Medicaid and Medicare and start working on stopping the fraud. I learned that Baraka Obama stopped the recession. Amadeo said, "President Barack Obama outlined the economic stimulus package during his 2008 campaign. Congress approved the $787 billion American Recovery and Reinvestment Act in February 2009." The economic stimulus package ended the Great Recession by spurring consumer spending. Its goal was to save between 900,000 to 2.3 million jobs. The economic stimulus plan was intended to spend $185 billion in 2009 and it ended a four–quarter decrease in GDP by the second from last quarter in 2009. After completing my outline, I started writing my paper. While I was writing I realized I needed to add more into the paper. So, I done a little more research and Get more content on HelpWriting.net
  • 9. Global Economic Recession Essay An economic recession is described as "a widespread decline in the GDP and employment and trade lasting from six months to a year." (Word Net) The economic recession is an international problem that has been affecting countries like the United States, China, United Kingdom and others for over two years. The latest recession began when house prices and sales began to fall and large drop offs in business investments started. Another causing factor of the recession was citizens with bad credit buying houses and real–estate and mortgages not being paid. Countries began taking action in 2008 by implementing stimulus packages and bailout plans, which can help a country locally, federally and on a global scale. The United States stimulus...show more content... With the 2009 stimulus package, the focus shifted from bailouts and large sums of money given to corporations, but too investing in infrastructure, health and other public services. In the 2009 stimulus package, $111 billion was set aside for infrastructure only. This includes federal buildings, municipal buildings, municipal recreational structures, roads and bridges and several other areas of construction (Hossain, and Cox). Money was also invested into social services, including education, where $53 billion has been dedicated to. This money has gone straight into schools that need some extra funding to remain open, and to prevent cuts in staff. This way, the level of education remains high, whereas schools closing would cause dropout rates to be higher, and averages to be lowered. In 2009, the US government also invested $87 billion into several States to cover Medic Aid costs (Hossain, and Cox). The government has also investing large amounts of money to repair roads, highways, rail ways and important bridges. Another focus for the US government is to make public transit easier to access for the public to cut down on citizens driving to work every day. Recently a large focus for countries in economic recession, namely the United States, has been to begin a new green initiative. In the United States, a large amount of money has Get more content on HelpWriting.net
  • 10. The business cycle is the short–run alternation between economic downturns and economic upturns (Investopedia n.d.). A recession is an economic downturn and happens in every country and some recessions are worse than others and the output of GDP and employment are falling farther and faster. The great depression lasted from 1929–1933 and was a deep prolonged downturn in the business cycle before a recovery/expansion of the business cycle occurred and GDP and employment started to rise (Krugman & Wells. 2012). The nextrecession lasted from 1981–1982 and was comparatively smaller than the first (Krugman & Wells. 2012). More recently in 2001 a slump in the economy was noted and was followed by the great rescission of 2007–2009 (Krugman &...show more content... An examples of the circular cash flow model is demonstrated in figure 21–6. "Firms produce output and then pay income to households and households then use this income to buy goods expenditure" (Pettinger. n.d.). Unemployment Rate & Labor Force Participation Rate Labor force is the amount of people who are employed and currently have a job and the people who are unemployed and currently do not have a job (Krugman & Wells. 2012). The labor force participation rate is calculated with people sixteen years of age and older that are employed, while the unemployment rate is measured by the percent of the total number of people sixteen years of age and older who do not have a job (Krugman & Wells. 2012). The United States assigns the Bureau of Labor Statistics (BLS) with the task of tracking the employment and unemployment rate of the labor force in the United States (BOOK). The BLS breaks down the unemployment and labor rate much farther than just how many are working and not working and breaks the cart down to race, age, gender, and level of schooling from no high school diploma to bachelors degree and higher for the year along with many other statistics and ways to track the populations work force (U.S. Bureau of Labor Statistics. n.d.). The BLS breaks down the labor force also by including discouraged workers, who are people that are not working but could work and have given Get more content on HelpWriting.net
  • 11. Economic Recessions : The Great Depression Economic recessions have been around for years and are very unpredictable for anyone can be affected by these economic downfalls. They had an impact on society for decades, and the effects of these economic recessions are still felt to this day. There have been more than forty seven known recessions that have occurred in this country over the years, and are a major part of American history. Although economic recessions are a natural hardship that the government and its citizens will encounter at some point in time lasting about only six months, the most famous and well– known recession that had happened in this country would be The Great Depression. The Great Depression, one of the worst economic depressions in the history of the industrialized world, lasted from 1929 to 1939. It began when the stock market crashed in October 1929, which resulted in millions of investors losing their jobs. As a result, consumer spending and investment had dropped, and by 1933 the country was at its lowest point and millions of Americans were left unemployed also half of the country's banks had failed. During this time of crisis, average American citizens had undergone many obstacles just to survive and to feed their families. With that being said, living everyday life was a struggle for most Americans. The Great Depression was the first to develop a large urban middle class. Families who depended on wage income and who believed that the necessities of life included not only food and Get more content on HelpWriting.net
  • 12. Effects Of Recession On The United States Essay Have you ever wanted explore at time other than the one you lived? I choose to analyze the July 1990–March 1991 recession that lasted for 8 months. Recession can occur at any point in time and can have a number of causes. In this paper, I will talk about what caused this recession, fiscal policy, monetary policy and end with recovery and expansion. II.Causes of recession There can be many causes of recession. In this case, the July 1990 through March 1991 recession was caused by a change in both, aggregate demand and aggregate supply. One of the causes during the recession was a decline in expectations about future income and wealth. The decline of consumer and business confidence leads to lower expectations, which will decrease aggregate demand. Then there was a change in factor of production prices which caused aggregate supply to change. The second cause of the 1991 recession, was an increase in oil prices, after the Iraq invasion of Kuwait. The input prices of oil increased, which would cause aggregate supply to decrease. Furthermore, the Federal Reserve lowered the rate of inflation which slowed economic growth. Lastly, after the baby boomers there was a slowing in the population growth rate. The unemployment rate leading up to the 1991 recession was much smaller than it was during the recession its self. In 1989 the unemployment rate stayed close to its average of 5%, with the greatest percent being 5.4%. In 1990, it stayed about the same until the Get more content on HelpWriting.net
  • 13. The Economic Recession of 2008 Essay Ever since the Recession of 2008, the process of acquiring employment has become extremely challenging and exhausting. After months of searching, a significant amount of job seekers are willing to accept any job offers that will allow them to put food on the tables. If you follow the United States' economic recovery, you probably know that there are about 10.5 million unemployed Americans and constant debates about how to create more jobs. What you may not know is that there are actually four million open jobs waiting to be filled. So how is it possible and who is there to blame? First, in order to better understand the scale of the problem let's take a closer look at the numbers. Since late 2007, nearly 8.5 million jobs were lost; in...show more content... Let's look at all of them and see why they do not always work. Online job search engines are not being a lot of help these days. Oftentimes the only people you will hear back from would be scammers and employment agencies seeking to make money on potential hires. After posting a resume on such web sites, there is a high chance that you will receive hundreds of emails offering work from home, or immediate job opportunity. Further research on the company will uncover numerous complaints or scam alerts. When it comes to applying through a corporate web site, there is one thing to be aware of: companies these days use help of automated resume scanners. With competition being as high as it is, one job listing attracts hundreds, if not thousands of job applications. In order to sort them out, corporations utilize special software that scans resumes for specific key words. Even though it makes the process a lot faster and easier, the automated systems won't necessarily recognize even the best candidate. With market being on their side, employers also take their time when making hiring decisions; job–seekers are subjected to multiple interviews, screening and tests. Since the process takes too long, the best candidates might move on long time before company makes up its mind. Job Get more content on HelpWriting.net
  • 14. The Great Us Economic Recession THE GREAT US ECONOMIC RECESSION Introduction Did you know that by the end of the year 2009 the unemployment rate had increased from its average 5% to an astounding 10%? This is because 15.3 million people became unemployed as a result of the economic recession. No shocker, but poverty rate had also increased from 13.2% in 2008 to 14.3% in 2009. This meant that the number of people living in poverty in the United States had increased from 39.8 million to 43.6 million. This great increase had all happened in the span of 1 year. Something that should have taken over 10 years only took 1 year and this is all because of the Great US recession. Also the US suicide rate had reached its highest record since 25 years between the years 2008–09. The great US recession was a result of foolish decisions made in the past, which then in turn lead to a slow and painful punishment for the US economy. It was caused mainly because banks were loaning out too much money; Banks used money which they didn't really have on paper to invest heavily into the housing market and the stock market; the debts which the citizens were creating by using large amounts of loans to pay for their daily expenses and to pay for expensive things became impossible to pay. Banks were loaning out too much money If you google when the US recession began it will answer 2007. So the better question would be when did it start to develop, because something so grand could not just have been made overnight. The answer to Get more content on HelpWriting.net
  • 15. Economic Impact Of The Great Recession This paper will be defining the 2008 great recession and the economic impact which the United States wasn't aware of. The great recession affected various businesses and others forced to increase prices or close doors immediately. Fiscal and monetary policies will also be discussed briefly in detail knowing the differences and determining the best course of action. Lastly will be implementing possible solutions to fix the economic problem and prevent any future recessions that could pose a devastating impact to economy. 2008 Great Recession Involvement The Great Recession was best known during the late President Bush into Obama era. Great Recession defined as; the economic slump began when the U.S. housing market went from boom to bust and large amounts of mortgage–backed securities and derivatives lost significant value (Investopedia.com). As the housing market was crashing, houses and business buildings have become vacant which the per capita rate for many cities dropped. The issue forced gas prices and goods to increase to make up for the loss per capita rate percentage. The economy doesn't see the big picture when prices rise and interest decreases, hurting, value and profits within businesses throughout country continue bringing down markets. Take Johnstown Pennsylvania for example; the city was known for the leading steel manufacturing companies. With the market declining with facts from 2000–2010 census data, Johnstown Pennsylvania has lost over 5 % of Get more content on HelpWriting.net
  • 16. Economic Recession Economic Recession of 2007 William Mwangi Class title and section Professor's name Due date of Assignment: 26th August 2011. William Mwangi Economic crisis Class Professor's name 24th August, 2011. Economic Recession of 2007: What caused it and what were the after effects? Can we predict another major recession? Thesis Statement: Although the recession that dates back in 2007 is still long and deep and surely has shown some recovery, the potential that it will completely recover is still vague. I.Causes of the 2007 recession A.Inflation B.Housing Prices C.Oil Prices –Recovery measures A.Cutting Production cost i.Caused unemployment B.Increase Interest rates by the Federal reserves i....show more content... Current Account Deficit," he explained that economic crisis has its background way back – a decade ago, as the developing countries had modest trade and account deficit of which was financed by borrowing from the rest of the world in order to invest more than save, bringing about financial crisis i.e. they will be rich in future by constructing infrastructures but face recession in present. Housing prices was another contributing cause to the recession. In the decade going towards 2006, housing prices spiraled up by more than 25%
  • 17. due to high demand, decline in lending standards, and low interest rates in the 2000s. Between 2000 and 2006 large number of borrowers took out mortgages as they were lured by the prevailing favorable rates. This had the effect of fetching all and sundry including those individuals with bad credit records. The Federal Reserve began to raise fed funds thus interest rates cropped from 1.25% to 5.25% – a reasonable level to fight the inflation level as well as overall loans between banks. Expensive repayment on loan had the effect of softening housing markets since borrowing was costly. According to Bernanke, "by August 2007, nearly 16% of mortgages were in default," (qtd. In Jones 6) this explains the advancement in the problem due to low housing prices that led to defaults and further lowered housing prices even further in a vicious cycle. In addition, Get more content on HelpWriting.net
  • 18. Growing Up From An Economic Recession Growing up in Ghana in the early to mid–nineties was very challenging for me and most people I came into contact with; yet provided the acumen to make sound personal and professional decisions. Ghana was recovering from an economic recession mainly attributed to series coup d'Г©tats that destabilized the economy and crippled most state institutions. As a result of this, the country experienced a protracted period of serious economic decline characterized by lax financial management, inflation rates well over 40%, extensive government involvement in the economy and an extremely high budget deficit. These weak macroeconomic fundamentals influenced the government's decision to implement a series of strenuous public policies; with the goal to place Ghana back on sound economic and social footing. I woke up one morning to prepare for school; however, I realized that the airwaves were filled with anger. Most people in my neighborhood were glued to their radio sets, waiting impatiently on the government to confirm the rumors, about its decision to replace the current sales tax rate with a new one; the Value Added Tax . Around midday, the government finally announced its decision to amend the tax system and outlined in detail various segments of the new tax policy. Under the new tax structure, taxes will be levied on every supply of goods and services made in Ghana, every importation of goods into the country and the supply of any imported service. The new tax system is meant to Get more content on HelpWriting.net
  • 19. Inflation And The Great Recession From the results, the effect inflation had on the savings, made the total price required to purchase the car increase by nearly $2,000 in three years. The new monthly repayments increased by $51.50 per month over a three year time period. These increases due to inflation are realistic, as a three per increase over three years isn't much. Get more content on HelpWriting.net
  • 20. Economic Recession in India National Conference On GLOBAL MELTDOWN Issues, challenges& strategies At Institute of Management & Technology, Faridabad Economic Recession in India and Survival strategies (Technical Session III) Kavita Verma DAV Centenary College, Faridabad Verma_ruby123@rediffmail.com OBJECTIVES OF THE STUDY To study the impact of recession on Indian economy I.Positive Impact II.Negative Impact To study the survival strategies for 1.Individual 2.Investor 3.Employee
  • 21. 4.Employer THE RECESSION India is facing the position of recession as globalization showing its negative scenario. As it was started in US and now it's touching the boundary of India also. Recession is a phase in which rupee depreciate, cash crunches, money market slowdown, inflation...show more content... Prepare your expenditure chart daily. Instead of retrenchment, change the salary package. Motivate your employees for doing hard work. Convince them for long working hour. To reduce the risk, segment your market. Daily calculate the inflow and outflow of cash from the organization. Keep in touch the changes government made in economic policy. INTRODUCTION TO RECESSION Every day we find newspaper is filled with headlines Recession. Share market is falling, inflation is coming, interest rates are falling, and all are together working to grasp a human being. An economy which grows over a period of time tends to slow down the growth as a part of the normal economic cycle. This is known as recession. As it was started in US after giving loans to sub prime market, now it covering the boundry of India also. The falling economy of US will affect the Indian economy. As the recession starts, Indian person starts taking their money from market, without considering the other side of coin. Credit crisis in America will effect our inflows, exports are effected badly and my more. Financial Crisis and Impact on India Actually the financial crisis was originated in the US. This was started when Banks in US started giving home loan to sub–prime market with a hope of getting good return. And the return actually return was very good. With stock markets booming and the system flush with liquidity, many big fund investors like hedge funds and Get more content on HelpWriting.net
  • 22. Essay about U.S. Economy The United States economy is currently not looking very good. Over the past couple of months the economy has taken a turn for the worst and we could be headed into a recession in the coming months or years. The biggest problems are in the real estate and mortgage markets. In 1999, housing prices rose at huge rates and lenders began offering riskier mortgages, which caused homeowners to keep piling up huge debts. People were taking out loans and balloon mortgage payments that they really could not afford. The problem began in late 2007, when housing prices began to fall and the system fell apart causing huge numbers of defaults on home loans and foreclosures. Currently, 5.6% of mortgages are delinquent, the highest rate in 21 years, and...show more content... The housing crisis that I mentioned earlier and resulting backlash through the entire economy has been building for awhile now but it has just came into the forefront in the past couple of weeks. We really haven't faced a downturn like this since the Depression. Last Tuesday, January 22, the Dow Jones industrial average fell almost 600 points and was already down 9% in 2008 (Gross 1). Immediately the Federal Reserve took action and cut the interest rates three–quarters of a percentage point, the biggest cut in 24 years. Today, not even a week later, the Fed again cut interest rates, this time by a half–point (Aversa 1). This move is an effort to keep the economy out of a recession by getting money back into the banks and encouraging them to keep lending credit to turn the economy upward. Whether or not it will work remains to be seen in the coming months. The government also announced another move to a couple weeks ago to help get the economy going again and avoid or slow down a recession. President Bush and the House are currently developing a $145 billion stimulus plan that would give tax relief to citizens by sending them individual checks for $300 and up. The plan would put over $100 billion into the hands of consumers and the government hopes that money would be spent and put back into the economy (Wolf 1). While all these things are good news for the struggling economy, most economic experts believe that a recession of some kind may be impossible to avoid Get more content on HelpWriting.net