Great Recession Research Paper

The Great Recession of 2007-2009 was one of the most economically disastrous events in American history. The housing market took a significant downturn during this period. People were not cautious when it came to their money and loans. Larger loans were given out to people, even to those with bad credit and low incomes. These large loans caused many homes to go through foreclosure since people were unable to pay off their mortgage debts. These debts were created by banks increasing the interest rates on the loans significantly in a short period. In 2008, foreclosures were up by eighty-two percent. This increase is significant because the previous percentage of foreclosures was at fifty-one percent from 2007. Unemployment skyrocketed, and people

Because of this downfall of the housing market, the U.S. economy fell along with other markets across the country. Homeowners had mortgages higher than what their homes were valued at, the decline in housing prices caused many people to default on their mortgages which caused the values of mortgage backed securities and CDO’s to collapse, leaving banks and their financial institutions holding those securities with a lower value of

The recession of 2008 is also called the ‘Great Recession’, said to have begun in December 2007, and took a turn for the worse in September 2008, and it was a severe economic problem expanded globally. This recession affected the world economy, and is said to have been the worst financial disaster since the Great Depression. The decline in the Dow Jones this time was -53.8%. Since the official start of the recession in December 2007, and through June 2010 there have been about 2.3 million homes foreclosed in the United States. In 2012, the state with the most foreclosures in January alone was California, with 51,584 houses being repossessed. Unemployment during this collapse was 8.5%, and continued to increase to about 10% as of 2010. People’s reaction to this recession was a huge decrease in spending and borrowing from banks, but an increase in saving.

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.

The Great Recession and the Great Depression are the fallout of the exact same economic phenomenon and are only different in a few (minor) respects. Each period is marked by a massive run up in asset prices followed by a tremendous deflationary pressure that has sent both debt and equity markets into turmoil (down). Although the Great Depression affected more than just the United State, the 2007 recession is very similar to the Great Depression because of the way that unemployment rates were the highest that was seen each time, the economic market got extremely bad, and consumer spending went down drastically. The 2007 Recession and the Great Depression both had unemployment rates that went through the roof.

The credit crunch had many effects on the economy. One of the effects was home prices. Home prices fell about 30 %, on average. The pecuniary resources of US households and non-profit businesses fell from a peak of about $69 trillion in 2007 to a trough of $55 trillion in 2009. The economic crunch and recession extended, events planned to improve economic growth were implemented on a universal basis. Many other nations such as China and the UK passed economic programs that used diverse combinations of government spending and tax cuts. These databases included the Economic Stimulus Act of the year in the year 2008. The State Reserve’s response to the crunch evolved over time and took a number of non-traditional ways. Initially, the state employed “traditional” policy actions by reducing the state fund 's rate from 5.25 % in September 2007 to a range of 0-0.25%in the end of the year in the year 2008, with much of the reduction occurring in January to March in the year in the year 2008 and in September to The end of in the year in the year

Everybody in the United Stated was affected by the recession that began in December of 2007 and spanned all the way to June 2009. Even though the recession is over, many people are still being affected by it and have still not been able to recover from the great recession. “The recent recession features the largest decline in output, consumption, and investment, and the largest increase in unemployment, of any post-war recession”. Many people lost their jobs due to the recession and some of them are still having a hard time finding jobs and getting back on their feet. Businesses

Despite the should-have and could-have afterthought arguments from Republicans, ARRA’s accomplishment cannot be discredited; it kept the real gross domestic product, or real GDP, from falling significantly, and it also increased employment. The Council of Economic Advisers, or CEA, reports that the real GDP began to grow steadily starting in the third quarter of 2009, and the ARRA has raised the level of GDP as of the second quarter of 2011, relative to what it otherwise would have been, by between 2.0 and 2.9 percent (“President Obama’s Stimulus”). ARRA struggle to win recognition of its

Home owners were caught off guard by the change in interest rates. Many people were already in debt from the previous recession by taking out home equity loans to keep them afloat. Many of which had now taken out subprime loans (which are loans offered to people with poor credit) from eager lenders and backed by the government.

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

The Great Recession, from 2007-2009, is the greatest economic downturn since the Great Depression, from 1929-1939. In spite of its currency, much of the world doesn 't know what led up to the Great Recession, let alone what caused it. This video simplifies the housing crisis and breaks down the key factors that attributed to the downfall of the financial market. While the recession only lasted two years, many are still feeling its effects.

The financial collapse of the U.S. economy that occurred in 2008 created a foreclosure crisis that resulted in thousands of homeowners losing their properties nationwide. This great recession caused many homeowners to even lose their jobs, savings, and credit worthiness. Predatory lending was a major contributing factor in these foreclosures.

This led to the Great Recession of 2008, which neatly aligned with the election of President Barack Obama. This recession lasted from the first quarter of 2008, where the growth rate of real GDP plummeted to -8.2%, until the third quarter of 2009. As with the recession of 2001, the unemployment was a lagging indicator and it hit a high of 10% in October of 2009. Unemployment rates were hit hard for the months following the recession. These extreme downturns called for another intervention by the Federal Reserve. The Federal Funds Rate was dropped to 0.16% in

Since the advent of the subprime crisis in 2007 that it is commonly believed to have led to the Great recession and to the present global financial crisis, these issues have been subject to much research. In fact, no one can claim that the Great Recession and the global financial crisis have been under-researched. In fact, the new world recession has been analysed from different angles and perspectives. Historians, economists, financial experts, psychologists, anthropologists and other experts in academic, financial, economic and other fields of research are still analysing the contemporary global financial crisis.

The economic financial crisis that started in late 2007 and officially lasted through mid 2009, but whose effects are still felt today was caused by several factors such as the sub-prime mortgage market collapse, an increase in the unemployment rate and a slow down in the economy1.Sub-prime mortgages are loans geared towards borrowers with lower credit ratings. The economic conditions caused home values to drop and a large number of sub-prime borrowers found themselves in homes that were worth much less than the mortgages. The structure of many sub-prime loans also caused rising monthly mortgage payments as loans reached adjustment dates and interest rates were increased.A sizable number of sub-prime borrowerswere left with few options