2008 Recession Research Paper

2008 Recession Research Paper
The fall of the housing market that begins the recession in 2008 was in large part due to the fact that people wanted large and expensive homes. These
were homes that they could not afford. Real–estate agents and their loan officers help manipulate the numbers for these unfortunate individual to get
bank loans from banks who would later foreclose on these homes. As the job market begin to decline and massive layoffs resulted all across the
country. Many individuals became delinquent on more than one or more house payments after losing their employment. Mortgage companies Lenders
Country wide and Fannie Mac and others found themselves holding a massive amount of risky home loans that could have ultimately collapsed the
world banking system.
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The Great Recession Essay
George Santayana, a Spanish poet and philosopher said, "Those who do not learn history are doomed to repeat it." This quote applies to the Great
Depression of 1929 and the Great Recession of 2008. There are many similarities between the two, like the causes, the actual events, and the aftermaths.
Several factors led to the Great Depression, which were the following: overproduction by business and agriculture, unequal distribution of wealth,
Americans buying less, and finally, the stock market crash of 1929. The Great Recession also had similar factors leading to it, like the housing
"bubble" burst and less consumer spending. In both events, the Presidents enacted programs that they believed would help the American people. In the
early...show more content...
economy, people began buying stocks on the margin. They would borrow most of the stock's price from a stockbroker and only pay a little bit of
the price. If the stock prices kept rising, this system would work well, but if the prices fell, people could not pay the loan back. Near the end of the
1929 year, prices were too high, so people wanted to sell their stocks. They thought the prices would lower soon. Stock prices did go lower and people
were not buying. They all wanted to sell their stocks. Prices went even lower on October 29, where 16 million stocks were sold. This caused the
collapse of the market.
Similarly, the Great Recession was due to consumer spending cutbacks and a drop in demand for the establishment of new housing. In the two
decades previous to 2008, the American growth rate was very high. Their household needs also became very high, which made demand increase.
Spending was at a high. However personal income was decreased. The consumers then had to borrow money from the banks. This gave the
consumers debt. So, when the house prices rose, banks stopped loaning money to people and the people decreased their spending. This happened
because the people were not able to pay the banks back. People also cut back on buying or making new houses, so household demand dropped. Many
say that this decrease caused the Great Recession. Housing was one of the main subjects that many believe, caused the Great Recession. "Subprime"
mortgage availability and low interest

Great Recession Research Paper
The Great Recession officially began in December 2007 and ended in June 2009, making it the longest recession since World War II. Some people
blame it on the greed of the Wall Street bankers and others on subprime mortgage lenders. It began with the bursting of an 8 trillion dollar housing
bubble. The subsequent loss of wealth prompted sharp reductions in consumer spending. This loss of consumption, joined with the financial market
mayhem, also led to a collapse in investment banking. Massive job loss followed the same trend as the dwindling consumer spending and business
investment. In 2008 and 2009, the U.S. labor market lost 8.4 million occupations – the most considerable business contraction of any recession since the
Great Depression. The Great Recession of 2008 was sparked by the housing crisis and Americans today still struggle with its effects.
Home builders responded to a false price signal in the economy –...show more content...
The Federal Reserve had began lowering interest rates from 6.5% in the late 2000, all the way down to 1% in November of 2003 and kept it there
until June of 2004. These artificially low interest rates encouraged consumers to buy houses and builders to produce more houses. However, the low
interest rate was not an accurate reflection of the true demand for houses in the marketplace. At the same time, Congress amended the Community
Reinvestment Act, encouraging banks to offer mortgages to lower income borrowers who would ordinarily not qualify for a loan. In addition, the
Federal Government required Fannie Mae and Freddie Mac, the now two infamous government sponsored lenders, to provide over half their mortgages
to low–income buyers, also known as subprime mortgages. Essentially, this meant that banks and other mortgages lenders were told to relax their
lending standards, and provide mortgages to people who

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

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

The Recession Of A Recession
Economical term 'recession' means a significant decrease in activity across the economy, which last longer than few months. This phenomenon is
visible in employment, wholesale–retail trade, and others. The recession is considered a normal part of the business cycle. Nevertheless, a one–time
crisis can trigger the onset of a recession. The global recession through 2007 to 2009 resulted in significant breakdowns to practically all the developed
and developing countries. In order to prevent a future financial crisis, numerous government policies were enforced. A recession usually last 6 to 18
months and interest rate fall to stimulate the economy. During a recession, people tend not to spend, borrow, but to save money because of a fall in
confidence. The government initiates an expansionary fiscal policy which involves increasing stimulus government spending and cutting taxes.
However, the question is can increased stimulus spending help end the recession. The first article, "Increased Stimulus Spending Can Help End the
Recession" by Lawrence H. Summers, argues that "for a successful economic recovery, the US government must pursue measures that increase
confidence, borrowing, and spending" (Summers 1). Summers alleges that the reason why recession keeps on is because of lack of demand. An
increase in spending to increase demand is the cure, even though too much spending was part of a cause in recession. Summers defined a recession as:
Recessions are times when there is too

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

In 2007, there was a Great Recession happened in the United States. The Great Recession was a worst financial crisis since the Great Depression
happened on 1930s. This financial crisis spread to the whole world such as Asia, Europe, and Africa. The Great Recession caused the world economy
dramatically going to the downturn. A lot of the businesses have to bankrupt. The major reasons that effect the Great Recession is housing bubble.
Before the recession, the house market increase the price of the house cause boom in housing, so many people going to borrow the loans from the
banks to purchase the houses. Therefore, many borrowers decide to accept high–risk debt because they think they would able to pay off quickly.
However, when the interest rates increase, the price of housing start decrease, which cause the worst housing market crash. According to CNN Money,
...show more content...
It also happens on many businesses, because the economy is in the downturn, many business stop purchase investment at that time. For example,
people would choose repair an old car instead purchase a new car. The consumption spending is one of the major profits in Untied States' real GDP.
Therefore, consumption spending fall, many farms or producers would not able to produce more goods because nobody willing to buy those
products. So the suppliers will choose to stop produce goods and services. Those business start lay off workers. According to the bureau of labor
statistics, "From late–2007 through mid–2009, the economy steeply contracted and nearly 8.7 million jobs were lost. Consumer spending experienced
the most severe decline since World War II." This shows all business start cut the huge amount of the jobs, and many workers lost their jobs caused
unemployment rate go to increase. That trend push the U.S economy going get

United States Recession Summary
The current United States recession began in 2008 which greatly impacted the construction industry. A recession occurs when a county experiences
zero or negative economic growth over a period of time. The current recession we are experiencing can be attributed to the many housing foreclosures
and excess housing inventory during this period. The housing market crash affected the entire United States economy and caused a negative economic
growth. The recession impacted the economy by causing unemployment, low gross domestic product due to low outputs, and increased public debt.
The construction industry experienced a sharp decline in the amount of projects, resulting in many construction companies closing. Many American's
feared investing their...show more content...
The 2009 American Recovery and Reinvestment Act helped promote projects via public funds to support construction companies. $130 billion dollars
of this Act was allocated to the construction industry to help stimulate the economy by offering public funded construction projects (Honek, Azar, &
Menassa, 2012). The government did this to keep the construction industry afloat during the housing market crash, since many of the companies
primarily did residential building and were suffering severly. By offering public funded projects it stimiulated unemployment rates to drop and more
cash flow in the economy. The government funded projects such as transportation systems, new government buildings, reconstruction of current
government buildings, and housing

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

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

Stages During Recession
The financial crisis that caused the recession caused consumers to buckle down on their spending habits. The three stages that was heavily influenced
from the recession were consumer pre purchase issues, purchase issues and post purchase issues. The mind of the consumer took a different approach
in how they spent their money. Many looked for bargains and the best buys on food and product consumption. Brand names were not as important to
the consumer as much as surviving the crisis.Consumers that found that purchasing the same product at a lower price still met the basic need of
survival (Mckenzie & Schardrodsky, 2011). After the financial crisis was over in 2010 the government took action and help increase consumer
consumption by lowering

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.

Essay On The Recession
Institutions have been affected by the recession. These institutions sort new opportunities for making profit and sustaining their activities. One type of
institution that has been greatly affected is the university institutions. These institutions have been affected, as a result, of cutbacks in terms of funding
by the state government attributed to the recession that caused economic turmoil in the country. These cutbacks by the government affects universities
countrywide resulting to them reducing their own spending and finding alternatives that would help sustain them. Nobody State University is one such
university that has been struggling to increase its revenue (Malcolm & McMinn, 2013).
There are several options such institutions are...show more content...
However, this might not be the case because of the fact that the price elasticity of offering university education services has a very low elasticity of
–1.2. This figure means that price changes in terms of tuition fee would have a small effect in the overall application of student in the university.
Therefore, it would be clear to say that an increase in the tuition fee would result in small change in the level of enrollment which would not affect the
overall revenue generated by the university, and this would rule out the hypothesis stated before (Amacher & Pate 2013).
According to findings in other institutions, that have adopted this option, the increases in tuition fees have actually raised the enrollment level of
students in those universities (Kaminer, 2014). One of the characteristics exhibited by this move of increasing tuition fees is that the overall number of
applicants for positions in the university will go down. However, universities counter this situation by increasing the number of enrollments from the
few who have applied spots in the university. Therefore, the number of students actually ends up being high, and the institution increases its overall
revenue. There would be cases where the revenue remains the same such as the number of students' applicants goes really low and so the institutions
would try to offset this situation by enrolling more. The situation could worsen if the pricing is wrong where they would charge more but

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,

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

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

The Great Recession Of The 2000 ' S Essay
I.Introduction
The Great Recession of the 2000's is something many of us have been affected by in some way or form. From the real estate bubble to the acts of
major firms on Wall Street–there were numerous factors that lead to this recession. The United States Government is to blame in large for what
happened to the economy in the early part of the 2000's. Major firms such as Merrill Lynch, Goldman Sachs, and AIG tried to used the failing economy
as a huge paycheck to their CEO's, payouts made partially by the US Government's bailouts. The government should have allocated money to the people
who were struggling, not continue to feed the "hand that bit them."
II.The Real Estate Bubble
The housing market had started to decline in 2007, after reaching peak prices in 2006. There was an extremely high amount of subprime mortgages
that had been issued in the early 2000's. Homeowners could no longer afford to live in their homes, payments started going to default, and foreclosures
started to rise. According to The Washington Post, there were five contributing factors to the housing market crash: low–doc loans, adjustable– rate
mortgages, equity line of credit, more money down than needed, and mortgage insurance.
Low–doc loans: a very easy loan where you do not need to show proof of income to obtain a loan.
Adjustable–rate mortgages: in simple terms, an adjustable–rate mortgage is when the interest on a loan changes with the market. This sounds nice if
the interest rate is

Research Paper On The Great Recession
The Great Recession
Started in December 2007, began with the bursting of an 8 trillion dollar housing bubble, this is called the Great Recession. After 911, the economic in
US trundown, in order to stimulate economic growth, the Fed chairman decrease the interest rate, tons of money flew into market. Because of the low
interest rate, the housing prices start increasing; also, the government encouraged people buy house for stimulate economic growth. People realized the
housing prices was keep increasing, they went to commercial bank applied for loans,eventhough, they did not need a new house. Because Fed chairman
set a low interest rate, the householder pay less money to bank than they earn from the house, many householders got a huge profit from it....show more
content...
Because of this high interest rate, the householder cannot afford the house, most of people start selling their house, the housing market start collapse.
In 2008 and 2009, the US. Labor market loss 8.4 million jobs, or 6.1% of all payroll employment. This was the most dramatic employment contraction
of any recession since the Great Depression. For the worker during the Great Recession, loss their job means that family incomes have dropped, adults
as well as children have lost health

2008 Recession Research Paper

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2008 Recession Research Paper