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I think this article I read about sums it up. http://www.associatedcontent.com/article/1078557/did_greed_cause_the_us_economy_to_fall.html?cat=3 The current U.S. economy has fallen and people are wondering how this happened and what caused the economy to fall. One reason the U.S. economy is unstable is because of greed. Banks became too greedy and gave loans to people that couldn't afford them. And consumers became too greedy and bought homes, cars and things on credit cards they couldn't afford.
As a result of this, the Stock Market is unstable. And the financial news is causing it to increase or decrease whenever something good or bad happens. Several banks are filing for bankruptcy and some banks are being bought by other companies so they can avoid bankruptcy.
One of the main industries that is being affected by the current economy is the real estate industry. So many home buyers were given a chance to own a home through the subprime loans. These loans gave people the false impression that they could afford a home that was out of their price range. But as soon as the rates and payments for the loans increased, these owners began to see that it was a bad idea to have a subprime mortgage. Many homeowners have lost their homes because of this. The subprime loans are one the reasons why so many homes have gone into foreclosure.
Another example of people being greedy in the real estate industry is the home builders. Before the housing market declined, home builders were building so many homes and believed they could make a profit from every home they built. When the housing market declined, home builders realized they built too many homes and they were going to have a hard time selling them. The current economy has forced home builders to cut the prices of their homes and lose profits.
The car industry is another example of an industry that has also been greedy. Several car manufacturers, mainly the U.S. automakers, have ignored the idea of making more fuel efficient cars and have continued to make gas guzzling vehicles. Because of the wrong choices they have made the U.S automakers are losing money. ****************************************************************** The housing crash, however, did not happen overnight. A number of factors contributed to the housing crash resulting extensive foreclosures and plummeting housing prices to their all time low. One of the main cause for the housing crash lies in the fact that banks and financial institutions were lending mortgages at 5 to 10 times the annual incomes of people, which was way above the safe value of 3 to 4 times. These financial powerhouses used aggressive terms and conditions but did very little scrutiny while providing mortgages. This led to an easy cash flow in the market which fueled the housing prices as well. The US economic meltdown also played a major role in the housing market crash world over. Foreign investors who had invested in the real estate market in US had to declare bankruptcy owing to massive loss. The housing crash is expected to cost the banking system a whooping $2 trillion dollars.
Read More : <a href=" http://www.housingnewslive.com/housing-market-crash-in-us.php">http://www.housingnewslive.com/housing-market-crash-in-us.php</a>
What else can I help you with?
How did the Global Financial Crisis affect the US?
The Global Financial Crisis of 2007-2008 severely impacted the US economy, leading to a deep recession characterized by high unemployment, widespread foreclosures, and significant declines in consumer wealth. Major financial institutions faced insolvency, prompting government bailouts and the implementation of stimulus measures to stabilize the economy. The crisis also led to a loss of confidence in financial markets and prompted regulatory reforms aimed at preventing future collapses, reshaping the banking and financial landscape. Overall, the crisis had long-lasting effects on economic growth, income inequality, and public policy in the US.
What financial crisis was the US taken out of with the start of World War 2?
The Great Depression
What was created to handle the financial needs and provide stability for the economy of the newly formed US?
The First Bank of the United States.
What happened to the economy in the Russian Domain after the demise of the former Soviet Union (USSR)?
Terrible, they asked the US for financial assistance.
What is the trouble asset relief program and how would it affect the ecnomy?
Troubled Assets Relief ProgramThe program is run by the Treasury's new Office of Financial Stability. This is the name of the program that will be taking care of infusing the much needed stability & liquidity into the markets.Purpose of TARP:1. To Stabilize the economy2. Improve Liquidity3. Improve Investor Confidence4. Reduce the impact of the financial crisis on the US Economy and GDP.
Insights of financial crisis.. this will give a benefits to?
The US Subprime financial crisis, caused a massive void in the country's economy and the liquidity in the markets was affected badly. Nobody has gained any benefit because of this. Everyone is suffering because of the crisis.
How did the Global Financial Crisis affect the US?
The Global Financial Crisis of 2007-2008 severely impacted the US economy, leading to a deep recession characterized by high unemployment, widespread foreclosures, and significant declines in consumer wealth. Major financial institutions faced insolvency, prompting government bailouts and the implementation of stimulus measures to stabilize the economy. The crisis also led to a loss of confidence in financial markets and prompted regulatory reforms aimed at preventing future collapses, reshaping the banking and financial landscape. Overall, the crisis had long-lasting effects on economic growth, income inequality, and public policy in the US.
How does the European debt crisis affect the US?
The European debt crisis can impact the US economy through various channels, including trade and financial markets. As European economies struggle, demand for US exports may decline, leading to slower economic growth in the US. Additionally, turmoil in European financial markets can create volatility in global markets, affecting US investments and financial institutions. Overall, economic instability in Europe can lead to decreased investor confidence, which may further impact the US economy.
What major event was happening when Obama was president?
This is probably the US financial and mortgage crisis.
What were the key economic impacts of the US financial crisis in 2009?
The key economic impacts of the US financial crisis in 2009 included a sharp decline in GDP, high unemployment rates, a housing market collapse, and a significant decrease in consumer spending. These factors led to a global recession and a long-lasting impact on the US economy.
Why are you having a federal bailout?
The Reasons for the Bailout Package: 1. To Stabilize the economy 2. Improve Liquidity 3. Improve Investor Confidence 4. Reduce the impact of the financial crisis on the US Economy and GDP.
What was the US GDP in 2007?
What is the gross domestic product for 2007?
Can Obama get us out of this financial crisis?
As Mr Obama said himself: YES, HE CAN.
How big is the US economy?
according to my point of view the us economy wont be co big in the future because of the present conditions and currency crisis of USA
The South Carolina nullification crisis of 1832 led to what?
to the us to have a bad economy for a while
What financial crisis was the US taken out of with the start of World War 2?
The Great Depression
What were the Causes of the bond 1844?
The bond 1844 was a US Treasury note issued to help stabilize the national economy during a period of financial crisis. It was issued following the collapse of several major banks and financial institutions due to speculative lending practices and overextension of credit. The bond aimed to restore confidence in the economy and provide a secure investment option for investors.
