Case Study: The Great Recession

he knew he did not have the organizational culture to reach it. In order to change the culture

Basic Underlying Assumptions are the beliefs that employees have about the everyday operation of a company. Chrysler’s employees began to believe that sales, market shares, and the awards were the most important aspect of their company; simply because that was what management kept pushing on them, probably in sales meetings (Kreitner & Kinicki, 2013). Their employees were so driven to get the quota to become sales person of the month and get a plaque with their name on it, and hung on the wall so everyone could see; that they got blind sided of what was really important (Kreitner & Kinicki, 2013). By striving to get this behavior down right, it is hard to begin to change back into what it was supposed to be or something new altogether because it has become a part of these employees belief of how things are to operate (Kinicki, 2013, slide 14).

Max: Hi I’m Max Lessins. This is Crash Course for economics and today we’ll be discussing the Great Recession, focusing on the fiscal and monetary policies used to recover from the 2008 economic meltdown.

The United States is a country that over the years has relied on its economic stability to continue providing acceptable living for its citizens and continue its leadership of the free world. This country went through an economic depression which lasted several years throughout the 1920’s and the 1940’s but successfully recovered from it after World War II. An economic boom in the 1990’s during George Clinton’s Presidency the federal budget was managed to be balanced and helped increase the economic crisis of the United States. The recovery did not last long as the United Stated went through a huge recession during George Bush’s Presidency in what many experts called the “Great Recession” which affected many especially businesses and middle class citizens. Although today many consider the recession to be over the effects of it can still be felt today specially by many middle class families like my own. I come from a small family of three which includes my parents and me. My family comes from minimum wage salaries and have been part of same line of work for many years however, the amount of necessities the family can afford has definitely changed. For example, the amount of groceries you can buy nowadays with a $20 bill is much less than those of the 1990‘s. The price of gas has certainly gone up which has caused many companies to outsource jobs or close down. My dad was laid off his dream job due to budgets cuts while my mom’s working hours have been reduced. As a result my

The U.S. economy is currently experiencing its worst crisis since the Great Depression. The crisis started in the home mortgage market, especially the market for so-called “subprime” mortgages, and is now spreading beyond subprime to prime mortgages, commercial real estate, corporate junk bonds, and other forms of debt. Total losses of U.S. banks could reach as high as one-third of the total bank capital. The crisis has led to a sharp reduction in bank lending, which in turn is causing a severe recession in the U.S. economy.

The Great Recession inflicted abundant harm in the U.S. and global economy; 8.7 million jobs vanished (Center on Budget), 9.3 million Americans lost their homes (Kusisto), and the U.S. GDP fell below what the economy was capable to produce (Center on Budget). The financial crisis was unforeseen by millions and few predicted that the market would enter a recession. Due to the impact that the recession had, several studies have been conducted in order to determine what caused the recession and if it could have been prevented. Government intervention played a key role in the crisis by providing the bailout money that saved those “Too Big to Fail” institutions. Due to the amount of money invested in the bailout and the damage that the financial crisis had on the U.S. population, “Too Big to Fail Banks”, and financial regulation are two of the biggest focuses of the presidential candidates. Politicians might assure voters that change will occur, but is it to late for change to be efficient, are the financial institutions making the same mistakes that led to the financial crisis?

In the hyper competitive world of today’s mega corporations controlled by the sway of the stock market, giant old industrial era companies rule over the automobile market in the United States as well as large parts of the global automobile market. Companies such as General Motors, Chrysler, and Ford were at the center of it until the economic crisis now known as the Great Recession of the late 2000s. The whole market was declining in sales with General Motors and Chrysler taking the biggest hits while Ford only suffered decline comparable to foreign automakers’, Honda and Toyota, levels due to restructuring in prior years. However, the tipping point was edging closer to bankruptcy with General Motors and Chrysler that ultimately

A budgetary stimulus is a necessity to help avoid recessions. Fiscal policy is when a government adjusts its’ spending levels and tax rates in order to impact the nation’s economic status. It is linked to the monetary policy which involves a bank and affects the nation’s money source. When there is an increase in unemployment and the economy is soon reaching a recession, the fiscal policy will help maintain the economy. The fiscal policy will decrease taxes and widely promote government spending. On the other hand, when unemployment is declining and prices are escalating, the policy will reduce government spending and raise the prices on taxes. The Great Recession was a horrific economic crisis that led businesses and buyers to drastically

The financial crisis that happened during 2007-09 was considered the worst financial crisis in the world since the great depression in the 1930s. It leads to a series of banking failures and also prolonged recession, which have affected millions of Americans and paralyzed the whole financial system. Although it was happened a long time ago, the side effects are still having implications for the economy now. This has become an enormously common topic among economists, hence it plays an extremely important role in the economy. There are many questions that were asked about the financial crisis, one of the most common question that dragged attention was ’’How did the government (Federal Reserve) contributed to the financial crisis?’’

In the course American Global Context taught at Mount St. Mary’s University, eight significant historical events from 1898 to contemporary times are covered. These events range from the assassination of William McKinley to the Great Depression to Pearl Harbor. One of these events, the 9/11 terrorist attacks, occurred in the 21st century. If I had the ability to add another event that possesses historical significance it would also be from the 21st century. The Great Recession of 2008 is the event that I would pick as the ninth historical event. By looking at the details of what happened, what the recession revealed about America, and what changed as a result it is possible to understand the immense significance of the recession.

The old saying the fox is going to watch the henhouse is some of it for same problems we run into with regulators regulating themselves. Part of the systemic problem that existed in the late part of the first decade of the 21st century were government entities known as Fannie Mae and Freddie Mac. Both of these government institutions would just as responsible as the banks themselves for the crisis that took place and sworn new regulation which may not be far-reaching enough.

When Sergio Marchionne first took the helm at Chrysler he was handed a company that had just declared bankruptcy and accepted a bailout loan from the U.S. government (McNulty, 2014). Needless to say, it was not a successful culture. He knew before he would ever see success he would have to change the way employees behaved, what they valued, what they expected, and make them believe that with his guidance they could be successful again. He knew he would have to change the entire makeup of the organizational culture. Here I will outline some of the mechanisms Marchionne utilized to change the organizational culture of Chrysler.

100 percent or more of the jobs lost during the Great Recession. Burgeoning urban centers like Austin, which has grown by some half-million people since 2000, are among the few markets in the country where home building is thriving. With their development- friendly policies and regulations, educated

     Thomas C. Mawhinney has a different approach to making a good corporate culture. His six ideas are the managers behavior, employee selection, the external culture, establishing a clear corporate mission, keep the mission up front, managers must reflect the desired culture, and employee’s learning must be ongoing, (Mawhinney, 23-74). Mawhinney’s first idea is the manager’s behavior. “Studies indicate that the single greatest influence on the work culture is the manager” (Mawhinney, 28). “The speed of the boss is the speed of the team”, said Chrysler chairman Lee Iacocca.

In reviewing this article it was observed that some employees were skeptical of the merger between Chrysler and Daimler-Benz. Daimler-Benz employees were proud of the elite image and were concerned about having that tarnished by another company. Chrysler employees voiced concerns about the addition of a foreign partner to one of America's auto manufacturers. Employees needed reassurance that this merger was going to be a success! In light of all the adversity both companies faced since announcing their plans to merge, how did they remain so steadfast in their commitment to pursuing this merger? What kept them believing this merger was a good deal that deserved a second look? To answer these questions I want to step back and discuss what I