Collapse Economy

Since the collapse of the housing bubble at the beginning of 2007 economists and administration representatives have been betting on the odds of a recess in the US economy. Currently we are mid-way through 2008 and mollify the experts have not made up their minds about its likelihood. stave the signs of crisis are eachwhere: the mortgage debacle continues unabated, driving mountain house prices and leaving in its wake a swan of foreclosure, company bankruptcies and shaking to its core the entire financial system, where salary have been going up in smoke as fast as they were created in the boom days of the sure estate market. Furthermore, the economic troubles are not limited whole to the industries related to the housing market. The same devastating picture ignore be seen in the airlines and automobile industries for example, which in fact collapsed soundly before the bursting of the real estate bubble. The US governments chemical reaction to the unfolding crisis has been yet again more of the same financial tricks that its used to manage its chronically sick economy e very(prenominal) time it has shown signs of a sudden decline: in summation pumping huge amounts of meretricious money into the economy in the promise that this will stimulate demand and keep the consumers partying on.

For instance, since last kinfolk the Federal Reserve has lowered its basic interest pose 7 times and has kept a semblance of swan in the financial system through a immutable flow of cheap money. However, even though government policies in the short term have saved the economy from a total collapse there seems to be a very high price to pay in store (no wordplay intended!) One of the main consequences of the Feds policy of cheap money is to have driven down the value of the dollar, which has clip record lows against the Euro and other major currencies, thus pushing up the price of commodities in the world market, which are priced in dollars. In other words, the Feds policy has sharply increased inflationary pressures around... If you want to get a full essay, order it on our website: Orderessay

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