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The crisis is a combination of bad laws and greed.
The CRA (Communitty reinvestment act) required banks to make loans in areas that they dealt in despite an ability to find people willing to invest in these areas with good credit. A percentage of all loans had to be in areas that were where the bank did business. There was no mitigation for a lack of people willing to invest in that area. This started in 1978 under Carter.
The second issue was when President Clinton removed the ability for banks to require legal income and verification. This caused banks to make loans to people with questionable income.
The bankers looked at the situation and said "Ok, we are taking the risk, let's get compensated for it". The rates for these loans went crazy high. Washington spent years ignoring this issue despite watching iit become larger and larger. Interest limits were raised to allow even higher interest rates for bad loans.
The ONLY President to suggest a solution to this issue was President GW Bush. His idea was shot down before a democraticly controlled congress. He later has been blamed by them for not stopping the issue.
The problem becomes worse when we give these corporations even more of our money and creating even more debt. In the past 100 days, we have added to YOUR debt over $3000.00 as an individual. That is your portion of what we have give these companies. The debt service is similar. You now owe $3000.00 a year ininterest on your portion of the governments debt. This will cause this recession to last even longer then it would have had they allowed the system to work itself out.
It should depress you that your government cares so much about these corporations that they are willing to mortgage your future and continue this recession. They caused it by over regulation. They can solve it by letting the system be allowed to work without their interference.
Wiki User
∙ 15y ago
Wiki User
∙ 11y agoThe Great Recession theoretically began during the middle of 2007, when house prices began to decline. As a result, banks that had massive exposure to sub-prime mortgages who expected housing prices to appreciate lost massive amounts of money. The stock market started realizing that something was wrong at the end of 2007.
Wiki User
∙ 15y agoThe current global economic crisis began in the United States.
Wiki User
∙ 14y agobush did it (i am at school right now)
but i thought that the economical crisis started with the arabs
Wiki User
∙ 15y agoIt started around early 2008 and it gained significance around mid 2008 and it intensified during late 2008.
Wiki User
∙ 14y agoIn September of 2008.
Wiki User
∙ 15y agoDecember of 2007, officially.
Wiki User
∙ 13y ago2007
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Did president Clinton had to deal with an economic crisis at the start of his 2nd term?
yes
How do you feel about the economic crisis in the US?
The current crisis (circa 2009/2010) is the worst economic crisis of American history, but the same is true for almost every country of the developed World. Part of the cause may be due to policies of the US government but the same can also be said for other countries. It possible that the expense of wars in Afghanistan and Iraq have made the crisis a little worse.
What is a economic crisis?
Economic crisis is wherein there is negative GDP growth lasting for two or more quarters. It is severe recession or depression.
What are some disadvantages of using BerkShares?
Speeding up the replacement of the us$ as the world's reserve currency which will lead to devastating economic crisis.
What do you mean by global economic crisis?
in July 2006
What will Obama do to help the US?
Take the soldiers out of Iraq and get us out of this economic crisis!!
Did president Clinton had to deal with an economic crisis at the start of his 2nd term?
yes
The US caused an economic crisis in cuba by?
passing a tariff on sugar
Do you agree that we are now in the economic and financial crisis?
Yes I do believe we are in a economic crisis
What are some forces that have unified the US?
Wars, 9/11, economic crisis, corrupt government
Is high education the solution to economic crisis?
Personally, yes education is the solution to economic crisis.
Is Ireland having a crisis?
yes! economic crisis
When will the crisis over?
You have to be more specific when you are talking about "crisis". Do you mean the economic crisis?
How do you feel about the economic crisis in the US?
The current crisis (circa 2009/2010) is the worst economic crisis of American history, but the same is true for almost every country of the developed World. Part of the cause may be due to policies of the US government but the same can also be said for other countries. It possible that the expense of wars in Afghanistan and Iraq have made the crisis a little worse.
When did the Zimbabwe economic crisis start?
In 1000 AD, the Shona people began their ruling on the land and then named it Zimbabwe
What will the 700 billion dollar bailout solve?
It will solve the economic crisis that has affected the US and the whole world
What is the difference between a financial crisis and an economic crisis and which of both affects the other most?
A financial crisis is when wall street and the banks are failing. An economic crisis is when there is high unemployment or a recession.
