The Recession Of 2007- 2010 Essay

The Recession Of 2007- 2010 Essay

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There is not just one probable cause for a country to enter into recession, depression, or a crisis. The recession of 2007- 2010 was hugely devastating in a sense people lost employment opportunities, standard of living, increase in personal debt, and the list goes on. From a macroeconomic prospective Gross Domestic Product/ Gross National Product; GDP/ GNP, inflation rate, fiscal & monetary policy, employment/unemployment rate, purchasing power of currency, poverty rate of nation is the major way to figure out the actual value of the country. There are many factors by which the economy can melt down and few major important factors are from low-interest mortgage rates, complex mortgage-backed securities, real estate bubbling, and highly leveraged loans by corporations and individuals as well. Real estate bubbling is selling a commodity at an inflated price with no regard to its fundamental cost.
The real estate bubble started somewhere in early 90’s. By the 2000 the demand for houses increased rapidly because of the extraordinarily low interest mortgage rates that were made available to future homeowners. Homeowners wanting to purchase a house, borrowed money from the banks and other financial institution. Banks being a major source of loan sharks, bank received its loans with extremely low interest rates from other global sources. The money to the banks were received by various other foreign currencies like India, China, S Korea, and many other investors in the United States economy. Other countries invested its currency in US economy as at the period US economy was considered to be the most liquid in regard to the bond/capital market.
United states took the advantage of the easy flowing money from around the world. Investors a...

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... betterment of the nation and some efforts can be given to the Budget Control Act of 2011. Over all the reduced rates of employment and poverty, and growth of output in finance, investing, and agricultural sector have led to an increase of the GDP. As a result of the positive remarks in 2014, it is more likely the investment from mortgage sectors, stock market, and more importantly consumer spending is up in the aggregate. The businesses are ready to make its move after the slow economic growth in 2012/13 into a potential cash flow in coming future. The nations GDP/GNP should be trusted to the extent as unforeseen events and emerging of the competition market like China, India, and other many nations should be looked over time and again. The recovery pace is directly related to the policy makers, as the $56 billion initiative was a great help in increasing the GDP.

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