This left the government no choice but to dip into public money to stabilise their banking crisis, which in turn decreased our budged by billions. So, as our tax money seeped out of our hands a little more vigorously than usual, little did we know that it was not going towards education, housing or improving our healthcare - but in actual fact, it was entirely invested to stabilise our banks. This alon... ... middle of paper ... ...come independent would racism evolve between England and Scotland? This isolation of the two joined country could perturb good relationships and increase racism between the two. This could savage any strong bonded business links and future opportunities for trade.
With billions of dollars being pumped into the banking system why then are banks still timid to continue financing home loans? 1. They are concerned that home prices will continue to fall, adding further risk to their bottom line. 2. Due to the immense derivative (OTC- Over the Counter) losses banks are simply faced with using taxpayer bailout money to stay afloat and continue manufacturing these exotic instruments that Warren Buffett has labeled as “Weapons of Mass Financial Destruction” .
Well the rates of foreclosure have decreased significantly since the peak in the 2008 housing market. The reason? Banks and lenders have learned their lesson and have set stricter guidelines in order for people to be approved. Banks are now looking at credit scores, possible collateral for the loans rather than making quick money off high interest rates and bogus approvals. The foreclosure rate is still a big economic problem, not to mention the increasing unemployment rate.
Should bonuses be paid to employees of companies which almost went bankrupt but didn’t because the company took bailout money from the government? Most bankers say yes, yet to the general public, this seems to be absolutely inexcusable. I decided to look into this topic further to satisfy my curiosity. The large banking businesses are in many ways at blame for the current recession. They lobbied for, and got, the relaxation of rules limiting how much debt they could have.
However, this practice left millions of families with large loans and mortgages that they could not afford when the house market fell, thus leading into delinquency and into foreclosure. This is one of the problems that has kept foreclosures in a seemingly endless cycle. Another cyclical problem is the depreciation in the prices of homes. With some houses reaching foreclosure and families just walking out or being evicted, the lack of maintenance of the fore... ... middle of paper ... ...economy. People will make smarter, more informed economic decisions and will have the skills necessary to prevent another economic crisis like our current foreclosure issue.
The consequence of this enormous debt is various but all have damaging affects to the country. Currently one third of total U.S. debt is own by foreign countries. Many of the foreign holder are investing more in their own economies as a result. By less countries investing into the U.S. demand for our currency will decrees causing interest rates to rise thous slowing the economy. By the U.S. continuing to add the already outstanding debt they are messing with powers that they can't manipulate for ever.
One was the brawl over the budget between republicans and democrats that threatened a government shutdown but fortunately was averted at the eleventh hour and recently the dispute over increasing the debt ceiling. With these events unfolding unexpectedly, it is unlikely that a common man is assured of a bright future when the government cannot even make willful decisions to compromise with one another and carve out transparent solutions. The recent dept ceiling deal is expected to further increase deficit spending. This booming dept is disastrous for the economy because for every dollar we are... ... middle of paper ... ...he returning war veterans from Afghanistan and Iraq. Works Cited Devin, Dwyer., & Martinez,L.
A great panic was caused in the Stock Market, resulting in job losses and companies going out of business. Mortgage was unable to be paid, thus causing foreclosure on many houses. The foreclosure crisis has not only caused the banking industry to lose Trillions of dollars; it has also played a role in decreasing home value on an international level. Despite the Obama Administration and Congress having taken many steps to stabilize the economy, like the Emergency Economic Stabilization Act of 2008, Wall Street Reform and the Consumer Protection Act of 2009, America has not seen many concrete results. But we must not lose hope.
These rates increased due to many of the banks experiencing the effects of the growing economic delay, which principally led to the forfeit of many monthly home payments. Without the revenue of the millions borrowed returning to the lenders, the banks tacked on ... ... middle of paper ... ...riod to recover from an unexpected incident, such as losing a job. If the government wishes to increase economic spending, then the Government Home Loan Option can be offered to the general public, Public Home Loan Option, with a slightly higher fixed interest rate than that of the foreclosure victims and thirty to forty years to pay off the mortgage. This will result in an increase in home and property sales, causing an increase of the number employed in the construction industry and timber industry. With the Government Home Loan Option, the government will be able to re-attain their money with interest, tax payers are not footing at the expense of American greed, and the government will invest in a calculated business proposal instead of simply loaning out tax payer’s money to corrupt businesses.
My Viewpoint: I’ll begin with Haidt’s first ethical principal of harm and care. I feel that our current government is not being responsible with the way it spends money. They have spent billions of dollars trying to stimulate the economy, but have only driven us further into debt and caused the economy further harm. The stimulus package that was initiated was full of ridiculous funding such as a million dollars to study the effects of ant breeding which is hardly a worthwhile project when we have such a high unemployment rate. Government needs to stimulate small business growth in an attempt to keep jobs here and reduce the unemployment rate.