preview

Economic Crisis In The United States

Decent Essays

The near-collapse of the financial system in the United States was the most substantial economic crisis in the U.S. since the Great Depression of the 1920s and 1930s. Since the crisis began in late 2007, more than 6 million Americans had lost their jobs, large and important financial institutions failed, and trillions of dollars in savings and retirement accounts had been lost. It is generally accepted that problems in the United States housing market are at the root of the current United States and global financial crisis. Regardless the causes and responsibilities, what is clear is that the result is a seriously weakened global financial system. It is important to thoroughly study the causes and consequences of the U.S. financial crisis and …show more content…

financial crisis, some questions had formed. Are the credit losses behind us? So far it seems that our economy could see more problems with residential real estate. The chance that shocks related to commercial real estate, industrial loans, and consumer credit cards could arise and cause an even worse problem. If the U.S. markets experience losses in any of these areas similar to what was experienced, the problems could resurface. When did the job markets recover? In June of 2009, the national unemployment rate stood at 9.5% with 14.7 million Americans unemployed^^. With the rate of unemployment so high, many consumers would not have had the funds to pay for mortgage and credit card obligations. Consumer spending accounts for about two-thirds^^ of the GDP(What is the GDP). That ultimately means that the economy needs Americans to spend more to maintain economic activity, which means that the government had to create jobs and opportunities to the unemployed. Have any other institutions fail during this time of crisis? Large financial corporations such as Citigroup and Bank of America appeared to have survived the crisis. Yet, smaller institutions like JP Morgan had a few concerns about their financial status, but there is still an uncertainty to the security of the financial

Get Access