2008 Economic Crisis

His belief that the federal government could not give direct aid to individuals left millions without help.

It is the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, the spread of technology, and military presence.

Average is the total amount of tax divided by the total amount of income...it therefore includes all deductions and tax brackets, usually lower % ones, getting to the total as part of it...average. The marginal, is on the NEXT $ of income. So it basically is going to be closer (or exactly) the highest tax rate you pay, being applicable to the last bracket your in, and generally having already used up all dedcutions available, and in fact, maybe losing some because some dedcutions drop off above certain incomes. Clear as mud? Marginal rate...the amount of tax pid on the NEXT $ of income...average rate includes the lower brackets and he tax, or no tax, on the first amounts of income.

Short term answer: recession happened because a lot of money disappeared when bad loans defaulted.

Long term answer: recession happened because of supply side economics.

Lending creates money. You put money in the bank, the bank lends it out, for example by writing a mortgage, the borrower has the money but you still have the same amount of money in the bank. The bank sells the mortgage, the buyer exchanges money for a financial asset, therefore the buyer's wealth does not change. The bank can now lend the money again creating more wealth.

When the mortgage defaults the last owner of the mortgage loses wealth. The borrower also loses wealth because the house goes to the bank but the value of the house is now less than the mortgage (because mortgages are defaulting all around and house prices have dropped), so the borrower still owes money.

If many mortgages default the economy loses money. That is, money disappears. We still have the same resources, but we no longer have enough money to transfer all the resources from producer to user, so some resources stand unused. That includes workers, factories, raw materials and consumer goods in stores, all waiting for money that isn't there any more.

The long term question is why there were so many bad loans. The long term answer is that "trickle down" policies took money from consumers and handed it to investors. Investors will invest in production only when consumers have the money to buy the product. If consumers don't have enough money to encourage productive investment, investors turn to financial investments to extract money from other investors. Or else they spend the money on things like art works, with the result that art prices soar.

A thriving economy works on "trickle up," not "trickle down." Workers get paid, and then as consumers they buy stuff from retailers. The money they pay the retailers goes partly to the retailer's profit, partly to workers and partly to wholesalers. The money paid to wholesalers goes partly to the wholesaler's profit, partly to workers and partly to producers. The money paid to producers goes partly to the producer's profit, partly to workers and partly to suppliers of raw materials. At each step a part goes back to the workers to go around again, and another part goes to investors to be reinvested. The process is driven by consumers buying. If consumers can't buy, nobody invests and nobody works.

Why the recession? Because we moved from a productive economy to a "service economy," from an economy that made and sold goods and services to an economy that shuffled money around.

Oil crisis is basically a phenomenon where the prices of oil products boost up because of the increase in world market's price which is caused to a so-called 'decrease' of oil deposits.

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The financial crisis was caused, at its very root (as in this was the last straw), by the sudden drop in home prices. Banks held mortgages on homes that people could no longer pay. Normally, the bank forecloses on the home and sells it for either profit or break-even. But this time, home values had fallen by as much as 40%. So banks lost 40% of their original investment when people started falling behind on mortgages payments and the banks were forced to foreclose. This is easier to describe with numbers. Say a bank gives a family a mortgage for the total value of their home, say $100,000 (this is lower than most mortgages, but makes it easier to see what's going on). The home then loses 40% of its market value, becoming worth only $60,000. The family then falls behind on their mortgages payments and the bank has to foreclose. The bank can only recover that $60,000 and is out $40,000. Now imagine this happening millions of times.

Once you get into much more complex financial mechanisms, we find that banks packaged these loans as investments call CDOs (collateralize debt obligations) that they then sold to other banks or financial institutions. Sometimes they are called commercial paper. When the value of these assets plummeted, a lot of financial institutions lost a lot of money. Again, normally this really has no bearing. But some bad choices were made with a normally useful financial tool called leverage. One can leverage funds by (this is a simple description) using the cash you have on hand as a down payment on a loan and then taking that loan an investing it. A great example of this is taking $100,000 and instead of buying just one house that you rent out to someone, you take out mortgages on 10 houses and use the $100,000 has a downpayment. You now own ten houses that you can collect rent from.

As you can see, the profit possibilities when leveraging assets (in this case cash) are amazing. Unfortuntately, you also magnify your losses. Imagine if you couldn't find renters for those houses. You're stuck with a huge loan and no way to apy it off, whereas with just one house you wouldn't be in debt. The point here is that a few financial institutions (Lehman Brothers being one) leveraged cash to buy these CDOs. These CDOs then plummetted in value. Lehman Brothers was unable to sell them because no one wanted them. Thus, they had huge loans from the leverage and they couldn't repay them.

So now we have banks that are extremely scared and cash-strapped. They don't want to lend moeny for fear of losing more.

the no of times a husband sleeps with his wife is called repo rate

I think you are asking Reason of Economic crisis.

1) Electricity, Gas, Water Problems

2) Terrorism

3) Lawlessness

4) Poor Economic Policies like interest rate in double figure.

5) Target Killing in Karachi

Most ensure the "Great Depression", but the times we are living in now will only get worse. Big corporations/the rich are controlling the poor/middle class by giving the corporations and the rich massive tax cuts. More money to the wealthy and less to the middle and under classes which will cause massive inflation.

Yes. The "Great Depression." And Inflation is indeed what threatens the economy, but it's important to know what causes inflation. Below is part of the definition from American Heritage Dictionary, but in simple terms, it is when there is a lot of money being put into the economy. This excess causes the value of each dollar to go down, so it costs more to buy a loaf of bread, for example. When the federal Reserve puts a lot of money into the economy, it causes inflation.

Inflation has nothing to do with class warfare, the rich against the poor.

"...or a persistent decline in the purchasing power of money, caused by an increase in available money and credit beyond the proportion of available goods and services."

Class warfare is very important because of the amount of money being put into the economy by each class. Inflation is also caused by printing more money than what's worth in gold that a country has.

1) to keep power equal in all 3 branches ( Checks and balances)

2) to provide national security

3) to have a econmic equality (money)

4) to pass laws so that we can live in a better country

It is because sometimes market fails to satisfy the needs of the consumers.So in that case we call it market failure.so therefore government needs fto intervene in order to keep the economy up the great standards,like in SA it is always the case for inflation to rise everyday wonder why?

AIG

High unemployment was an effect of the Great Recession.

If resources are easily accessible for countries, they can trade these resources for other resources or goods they don't have. Resource surpluses can also be sold for a profit to other countries.

Is that the income levied on individual earnings.

The relationship between production and cost in any manufacturing process varies based on volume produced and whether any part of the manufacturing process is outsourced or performed by subcontractors. Additionally, production and cost ratios vary based on the amount of automation involved in production and the amount of human oversight and involvement required.

Because of many factors that are occurring in a simultaneous fashion. The crucial ones are:

1. Due to Risk Aversion on the part of Currency Investors, the Demand for the US Dollar has gone up world over

2. Uncertain Economic Situation around the globe

3. FII's turning Net-Sellers and withdrawing funds from the Indian Market

All countries across the globe are affected by this economic crisis. The ones that are worst hit are United States (USA), United Kingdom (UK), Germany, Japan, Brazil etc.

The economic crisis is believed to have originated from the USA but since they are the largest economy in the world and almost all countries are interrelated to one another the effect spread to all nations

Domestic output, and employment falls

There are several reasons but an obvious one is the lack of investment in the pound by foreign investors. Foreign investors in British banks will expect a return on their money. This is the 'interest rate' that we hear of. Interest rates have a double effect. If they are low, then borrowing is cheaper, people will therefore spend more as they can afford to borrow more, and more people will be kept in work (such as shopkeepers and manufacturers) as a result, thus minimising, as far as possible, the effects of the recession. However, savers will get less interest on their money. If interest rates are high, people will save more as they will get a better return on their investments, but those who borrow money - like most businesses - will find their costs increasing because they have to pay more interest. Therefore they put their prices up to cope, and so inflation - where prices increase and increase year on year - will become a problem. In the present (2009) recession, the Bank of England decided to lower interest rates to such a low amount (the lowest almost in history) therefore helping those who borrow money - like businesses and mortgage payers - and hopefully persuade people to buy more so that fewer traders go out of business and unemployment does not escalate out of control. This means that foreign investors will not invest in pounds because they can get a better rate of interest elsewhere, say, in the Eurozone countries or in the USA. Because of this lack of demand for the pound, its value falls, just as any other commodity would do. A low pound is not necessarily a bad thing. Although it makes imports more expensive as a weaker pound buys less, and foreign holidays are more expensive, the weak pound encourages us to buy British wherever we can, something which is really necessary in a recession to keep our own people in work, and also makes our goods much cheaper to sell abroad - which is again good for exports and the economy. In Harold Wilson's time as prime minister in the 60s, during another bad economic spell, rather than use interest rates, he actually devalued the pound overnight, delaring it worth less the next day. This had the same effect of increasing exports and encoouragiing us to buy more to avoid mass unemployment. There are those who believe that if Britain was in the Eurozone countries it would be better off, but this is not the case, even if the pound becomes the same value (or less) than the Euro. The reason for this is simple. In Europe, the interest rates are governed centrally in a 'one-size-fits-all' system. This means that countries like Greece, Portugal, Ireland and Spain (that are having real problems within this recession), will not be able to control unemployment and lack of spending and so on, as they are all linked to the central European interest rate, and couldn't lower it, or devalue even if their country neared ruin. They will be far worse off during the recession as will Britain as here we have the luxury, being outside of the Euro, of being able to set our own interest rates, and control our own path through the recession without being beholden to anyone else.

banks invest money in the stock market, stock market crached, so did the banks

Cerberus was a mythological creature. a Dog like monster with three heads whom lived in the underworld.