Theories Of The 2008 Recession

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To be precise, a recession is when firms fail to grow, the GPD falls for two consecutive quarters, unemployment increases and housing drop (Morah, 2008) example 2008 downturn. According to authors Rittenberg and Trenberth 2012, the 2008 recession recognition lag noted around October of 2008, confirmed by the Cycle Dating Committee of NBER declaring it had started in December 2007. The economic downturn pushed the United States government to jump-start the economy using two economic theories known as the fiscal and monetary policies.
The government stepped in and intervened using fiscal policy of the Keynesian economics theory. The fiscal policy allows the government to adjust spending level, and tax rate. The government has the power to lower
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