Economic Crisis
The revelation of the financial crisis that unfolded in United States in 2008 is considered to be the worst economic crisis since the Great Depression, 1929. The distinctive causative factors that have contributed to the U.S. economic crisis 2008- 2009 are differentiated by aggravated financial control, higher risks in capital investment, the housing bubble phenomena in relation to the brisk credit expansion. The aggregation of these factors in the U.S. economy directed the economy towards the de- leverage and credit crunches as the bubble burst. The following paper shall be discussing about the degree of correlation between the tax implications policies with respect to the financial crisis in U.S.. The precise review of strong linkages between the taxation and economic crises is the explicit explanation of the crisis that shook America. The paper also highlights the key factors that demonstrated their abilities and rescued U.S. In the economic crisis.
Introduction
The…...
mlaReference
Carr, D.A. (2011). Responses to Local Fiscal Shocks: Path Dependency Effects of the Clean Air Act. Public Finance and Management, 11(2), 160+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5050180027
Hendrickson, J.M., & Nichols, M.W. (2010). Did Commercial Banks Close Branches in Low-income Neighborhoods in Response to the Cra? Implications for Understanding the 2007-2008 Financial Crisis. Journal of Legal, Ethical and Regulatory Issues, 13(1), 17+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5044499375
Johnson, E.M. (2010, April). Mr. Trust Buster. In These Times, 34, 7+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5041402599
Robinson, S.N., & Nantz, D.P. (2009). Lessons to Be Learned from the Financial Crisis. Journal of Private Enterprise, 25(1), 5+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5037768696
Economic Crisis Policies
US current economic crisis is considered to be started from real estate sector. The real sector started to decline in 2006 and it accelerated in 2007 and 2008. Housing prices have fallen from the peak from about 25% so far. The decline in prices left homeowners with no option and they were unable to refinance their mortgages and causes default of mortgages. This default of mortgages and loans swallowed the banks and financial markets such as falling of Lehman's brothers and other anks and blow to rest of economy happened as the whole economy was relying on banks and ultimately it slows down investment in the country and capital flows to other parts of the world like China and India. ank losses cause reduction of bank capital which in turn requires capital reduction thus saving bank from lending. It is estimated that every $100 loss and reduction of…...
mlaBibliography
ISR international socialist review. (2009, april). Retrieved from The U.S. economic crisis:causes and solutions: http://www.isreview.org/issues/64/feat-moseley.shtml
Journal of accountancy. (2009, october). Retrieved from The U.S. economic crisis: root causes and road to recovery: www.journalofaccountancy.com/Issues/2009/Oct/20091781
Eyes on wall street. (2011, april). Retrieved from Levin coburn investigates casues of financial crisis: http://www.eyesonwallstreet.com/2011/04/articles/financial-crisis/levincoburn-report-investigates-causes-of-the-financial-crisis/
Rude, C. (2009). World Economic Crisis and Fed Reserve Response to it. Studies in Political Economy.
The U.S. is a property owning civilization and a number of the people wanted land and housing. Americans however scarcely ever create savings. "The country itself lives on other countries' savings by issuing bonds to finance its excessive consumption. The current crisis began with cheap housing loans offered by banks. Banks provided loans but instead of holding the loan in their books, they packaged them into collateralized debt obligations (CDOs) and sold them to other agencies. These agencies passed them on to others and spread them globally as assets" (the Current Economic Crisis, its causes, its impact and possible alternatives, 2009).
Interest rates were lowered and housing loans went up with construction activities leading to land prices increasing. The real estate was booming, generating employment and incomes. But as the rate of interest on housing loans came down, banks started to compete to get more business. Because of low interest rates,…...
mlaReferences
Avizius, R. 2009. Financial Crisis Big Picture: What has the Government Response Been? [ONLINE] Available at: [Accessed 22 May 2012].http://www.marketoracle.co.uk/Article9229.html .
Centeno, M.A. & Cohen, J.N. 2012. The Arc of Neoliberalism. [ONLINE] Available at: [Accessed 22 May 2012].http://www.yale.edu/macmillan/transitionstomodernity/papers/CentenoCohen.pdf .
Crotty, J. 2009. Structural causes of the global financial crisis: a critical assessment of the 'new financial architecture' . [ONLINE] Available at: [Accessed 22 May 2012].http://cje.oxfordjournals.org/content/33/4/563.full .
Esteva, G. (n.d.). The Meaning of the Global Crisis and "Recovery" for Study Abroad: What are we Preparing Students for? [ONLINE] Available at: [Accessed 22 May 2012].http://digitalcollections.sit.edu/cgi/viewcontent.cgi?article=1110&context=faculty_symposium .
Economic Crisis 2008-2009
This report focuses on the events that took place in the Great crash of 2008-2009. It aims to highlight the events that took place and what the basic factors and events were that eventually led to the economy crashing. It is also a point of focus to determine what effects came about and how different parties were to be blamed for the deregulation that led to the catastrophic events of the crash. It is linked with the policies present at that time i.e. The Monetary Policies outlining the control of money supply and interest rates as well as the Fiscal Policy that focus on the government spending and taxation policies.
The financial crisis refers to a situation whereby there is a contraction of money supply and the amount of wealth in the economy. This is also known as a "credit crunch" whereby participants of the economy lose their confidence…...
mlaReferences:
Minkiw, Mc Gregory. (2009). The Financial Crisis and the Economic Downturn of 2008 and
2009. Macro Economics (7th Edition).
Ryan (2008). The 2008-2009 Financial Crisis-Causes and Effects. Cash, Money, Life.
http://cashmoneylife.com/economic-financial-crisis-2008-causes/
This program is focused onto the following directions:
Generating stability with exchange rates
ebuilding confidence in the monetary policy
Better managing and restricting public debt
eforming and restructuring the banking sector to insure more transparency and the implementation of internationally recognized policies (The Icelandic Government Information Center, 2008).
4. Short-term forecast for the economy
The 2008 has severely impacted the Icelandic economy. In light of the dramatic effects as well as the efforts put into the reconstruction and reconsolidation of the Islanding economy, major growths are not expected. In other words, it is generally assumed that the country will regain its stability through small and gradual victories, which will, for the time being, only manage to stabilize the economy. Growth rates are expected to remain low and for 2010 for instance, the growth rate of the gross domestic product is expected to be close to zero (Central Intelligence Agency, 2010).
In terms of actually achieved stability,…...
mlaReferences:
2008, Economic programme in cooperation with IMF, The Icelandic Government Information Center, / last accessed on August 2, 2010http://www.iceland.org/info/iceland-imf-program
2008, Economic outlook 2008-2012, Landsbanki, last accessed on August 2, 2010http://www.landsbanki.is/Uploads/Maillist/Docs/economicoutlook2008-2012.pdf
2008, Glitnir releases economic forecast for Iceland, IceNews, / last accessed on August 2, 2010http://www.icenews.is/index.php/2008/06/02/glitnir-releases-economic-forecast-for-iceland
2010, Iceland economic statistics and indicators, Economy Watch, / last accessed on August 2, 2010http://www.economywatch.com/economic-statistics/country/Iceland
As Taibbi shows, it is not easy: "I'm going to say something radical about the Tea Partiers. They're not all crazy. They're not even always wrong. hat they are, and they don't realize it, is an anachronism. They're fighting a 1960s battle in a world run by twenty-first-century crooks" (Griftopia 16-17). Taibbi makes clear that the Tea Party is not even homogenous: it is made up of a broad spectrum of individuals (some of whom do not even want to be called Tea Partiers) who are angry and looking for someway to focus their anger.
In conclusion, recouping the losses is not an easy thing to do. hen a company like Lehman Brothers can be allowed to collapse while their competition (Goldman Sachs) can be bailed out by tax payer dollars, citizens are going to start wondering how their country got to such a point in the first place. Taibbi…...
mlaWorks Cited
AP/HuffPost. Charles Ferguson's Oscar Speech Rips Wall Street: 'Inside Job' Director
Levels Criticism During Acceptance. HuffPost Business. Web. 8 Apr 2011.
Campbell, Andrea Louise. "Is the Economic Crisis Driving Wedges Between Young and Old? Rich and Poor?" Generations 33.3, Fall 2009: 47-53. Print.
Espo, David. "Deadline nears: Shutdown looms without agreement." Yahoo! News, 8
Economic Crisis
The recession of 2008-2009 and the subsequent government responses provides a good test for economic theories. There are no controlled experiments in economics, so we can only work with case studies in order to understand how economies work. A good starting point is to consider the issue through multiple different lenses, so that we can understand how the crisis occurred and what prescriptions might be best suited for response either to address the root problems or to engage in prevention. This paper will consider the works of Marx, Schumpeter and Keynes in analyzing the financial crisis. All three of these men would have been able to understand its causes, but likely would have taken very different approaches to solving the problem.
The second issue at hand is the question of the future of capitalism. We have a pretty good sense at this point of what the response of government is…...
mlaReferences
Cox, W. & Alm, R. (2013). Creative destruction. Library of Economics and Liberty. Retrieved December 7, 2013 from http://www.econlib.org/library/Enc/CreativeDestruction.html
Eichengreen, B. (2010). The crisis of financial innovation. University of California at Berkeley. Retrieved December 7, 2013 from http://emlab.berkeley.edu/~eichengr/crisis_finan_innov.pdf
Isfeld, G. (2012). Canada's banks shake off global sector crisis. Financial Post. Retrieved December 7, 2013 from http://business.financialpost.com/2012/10/10/canadas-banks-shake-off-global-sector-crisis/
Liu, H. (2008). Too big to fail moral hazard. Asia Times. Retrieved December 7, 2013 from http://www.atimes.com/atimes/Global_Economy/JI23Dj12.html
Ergo, the role of the EU seems to be that of implementing protectionist policies. These would be developed onto three simultaneous directions.
A first set of policies would revolve around the creation of a new market architecture at the EU level. This would strengthen the EU's position in the face of future challenges by:
ensuring a sustained and strong support from central banks allowing banks to rapidly implement the rescue plans, and allowing the Union to rapidly implement decisive methods that would prevent the expansion of the crisis to other countries (Commission of the European Communities, 2008).
A second set of strategies revolves around the necessity to really analyze the impacts the crisis has had upon the real economy and find ways in which to improve the real economy. These policies would combine short-term solutions to issues in need of rapid response as well as long-term projects. The short-term solutions would be…...
mlaReferences
Budowsky, B., January 22, 2008, the Economic Crisis, the Hill
Kilmister, a., December 2008, the Economic Crisis and Its Effects, World Economy, No. 407
Miller, J., Jackson, B., Who Cause the Economic Crisis? The Annenberg Public Policy Center of the University of Pennsylvania
last accessed on January 7, 2009http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html ,
Thus if the taxation policy is shifted, it is possible to create a better situation. Taxes that are now current can be abolished if their contributions are minor. On the other hand taxes can be levied on things that are considered harmful like tobacco and drugs. This will be discussed when the remedies are sought to be established. (Edwards, 292)
"What should be done to resolve it most effectively?"
Tax cuts and abolishing some taxes can be effective with increased government spending. John Meynard Keynes advocated government spending as a method of getting over recession. Therefore a deep consideration of the federal government budget is in order. The budget uses the taxes, and spending by government to reach the desired equilibrium and thus the taxes, and spending are often beyond the general equilibrium and hence budgets are always unbalanced. To control inflation taxes are raised and spending reduced. Like wise in…...
mlaReferences
Brue, E. Essentials Of Economics.
Tata McGraw-Hill, 2006.
Carbaugh, Robert J. Contemporary Economics: An Applications Approach.
M.E. Sharpe, 2010.
This mindset was made possible by their intensive investments in new technologies that made transactions inherently unauditable and untraceable by the Securities and Exchange Commission and other governance entities. Given the automation of these complex trading workflows and the inability of governance bodies to keep pace with technological advances, coupled with banker's unwillingness to assist governments in tracking increasingly intricate transactions, the bankers could literally make their own rules up as they went along. What has differentiated this global economic downturn from others is how pervasive this attitude has become of offloading risk by aggregating toxic and bad loans together, using technologies to increase speed of transactions while alleviating accountability (Corden, 2009).
An aversion to risk has been replaced by a consolidating, aggregating and re-selling of completely worthless and often called "toxic" loans, with accountability of the performance of investments left by the wayside. Bankers had the most to gain…...
mlaReferences
John C. Bogle. (2009, April 21). A Crisis of Ethic Proportions. Wall Street Journal (Eastern Edition), p. A.19.
Corden, W. (2009). The World Credit Crisis: Understanding It, and What to Do. The World Economy, 32(3), 385.
John Dobson. (2003). Why Ethics Codes Don't Work. Financial Analysts Journal, 59(6), 29-34.
Jeffrey C. Gerrish. (2002). Ten new commandments for corporate governance. American Bankers Association. ABA Banking Journal, 94(11), 16-20.
Subprime mortgages were not by any means a major component of the total market, yet when they crashed, the high degree of market interdependency led to sharp declines in the value of many companies, not just banks that happened to be burdened with toxic assets. The methodology will therefore begin by comparing the interdependence of different markets over time. This will reveal whether or not sectors and global markets have become increasingly correlated over time. It is hypothesized that they have, which in turn has contributed to an increase in systemic risk as such interdependence reduces the value of diversification.
The second component of the paper will examine what is being done with respect to reducing systemic risk. This component will include an overview of the traditional theory and a review of the current literature on systemic risk. The crisis has spurred new work on systemic risk, including work specific…...
mlaReferences:
Weisman, J. & Paletta, D. (2009). Summers says more regulators could join Fed to police risk. Wall Street Journal. Vol. 254, 62, A3.
Huang, X; Zhou, H. & Zhu, H. (2009). A framework for assessing the systemic risk of major financial institutions. Journal of Banking and Finance. Vol. 33, 11, 2036-2049.
The second recommendation I would make with respect to external communications is that Liddy adopt more stringent measures than the government has insisted upon with respect to spending controls. The government has set out some measures, but AIG should be tougher than that. This would demonstrate a sense of culpability on the part of the company for the fact that the situation it is in is of its own making. A major component of the public's offense is that it feels cheated in the deal. Taxpayers, many of whom are feeling the sting of economic hardship themselves, are insulted that they have been called upon to bailout a company that then pays six and seven-figure bonuses to its executives. Most of the people contributing tax dollars to those bonuses will never see money like that in their lives. Liddy has the luxurious advantage of not being directly responsible for the…...
mlaWorks Cited:
Karnitschnig, Matthew; Solomon, Deborah; Pleven, Liam & Hilsenrath, Jon E. (2008). U.S. To Take over AIG in $85 Billion Bailout. Wall Street Journal. Retrieved April 25, 2009 from http://online.wsj.com/article/SB122156561931242905.html
No author. (2008). Cheque Mate. The Economist. Retrieved April 25, 2009 from http://www.economist.com/finance/displaystory.cfm?story_id=12607251
Tuggle, Elizabeth. (2009). AIG's Bonus Payout Just the Latest Source of Outrage. Fox News. Retrieved April 25, 2009 from -- million-bonuses-employees/http://www.foxbusiness.com/story/markets/industries/government/aig-hearing
Kuykendall, Lavonne & Murti, Bhattiprolu. (2009). AIG Gets Aid, Minus Bonus Pay. Wall Street Journal. Retrieved April 25, 2009 from http://online.wsj.com/article/SB124022481818534555.html
Economics and Global Capitalism The problem with the kind of thinking that postulates that human nature is based on self-interest is that underlying this supposition is the assumption that human nature is completely rational and logical and would never do anything to harm itself. This is not the case and economic booms and busts indicate as much. Self-interest is not always aimed towards a positive end. Sometimes, for instance, short-term self-interest is detrimental to long-term self-interest and vice versa. Sometimes people are motivated not by self-interest (at least in a temporal sense) but by charity, kindness, selflessness, self-sacrifice, or altruism. It could be argued that people sometimes believe they will be rewarded in a spiritual sense for these actions, but the basic idea is that they are essentially unselfish acts. Thus, to assert that self-interest is the rational motivating force behind human behavior is to really not understand humanity: humans are…...
As banks faltered and default rates rose, rates of consumption and demand plummeted. Unemployment began to increase, and in a predictable Keynesian fashion, as individuals grew more insecure about their job prospects they began to spend less money. The United States has a particularly consumer-driven economy -- Americans are known for having historically low rates of savings and to engage in high rates of spending -- so this was particularly disruptive to the usual rhythms of the economy.
Young people graduating from college suffered some of the worst effects of the recession. "Unemployment rates for individuals younger than 25 are currently 21% in the euro area and 19% in the U.S." (Branchflower 2010). They were competing with older, more experienced workers who had recently lost their jobs. The fear is that today's low starting salaries create a class of permanently low-earning graduates, many of whom have high levels of college…...
mlaWorks Cited
Branchflower, David G. "Credit crisis creates Lost Generation." Bloomberg Business.
January 21, 2010. August 28, 2001.
Ferguson, Niall. "Where did all the money go?" From the Great Hangover. Edited by Graydon
WTO
As the worldwide economic crisis of 2008 demonstrated, the economies of governments the world over are highly interdependent. Within this context, the World Trade Organization is coming under closer scrutiny. Negotiations are repeatedly failing and governments continue to violate commitments under WTO agreements with a dispute resolution process many countries find unsatisfactory. This paper reviews both the theoretical and practical economic and political implications of the faltering -yet ongoing -DOHA Round trade liberalization negotiations.
Recent WTO Negotiations: Seattle, Cancun, and Doha
Difficulties during WTO negotiations over the last decade can be attributed to three primary factors: the sheer numbers of member countries who all want to actively participate, the divergent interests between developed and developing nations, and finally the bureaucratic and management complications which arise from the increasing scope of WTO regulations. The most recent round of trade negotiations in the WTO began in the winter of 2001 in Doha, Qatar. In…...
mlaBibliography
Clapp, J., 2006. WTO Agriculture Negotiations: Implications for the Global South. Third World Quarterly, 27(4), pp. 563-577.
Couglin, C.C., 2010. Measuring international trade policy: A primer on trade restrictiveness indices. Review, 92(5), pp. 381-394.
Cuyvers, L., Dumont, M., Rayp, G., and Stevens, Katrien, 2003. Wage and Employment Effects in the EU of International Trade with the emerging economies. Review of World Economics, 139(2), pp. 248-275.
Devadoss, S., Sridharan, P., aAnd Wahl, T., 2009. Effects of trade barriers on U.S. And would apple markets. Canadian Journal of Agricultural Economics. 57(1), pp. 55-73.
Title: The Rise of Political Discontent and Economic Transformation: Analyzing the Emergence of New Dynamics in the 1993 Canadian Federal Election
Introduction:
The 1993 Canadian federal election marked a pivotal moment in Canadian political history, characterized by a significant shift in the political landscape and the emergence of new electoral dynamics. This thesis aims to explore the emergence of these dynamics, focusing on the interplay between political discontent, economic transformation, and the rise of new political parties. It will investigate how these factors contributed to the electoral outcomes and reshaped the Canadian political landscape.
1. The Rise of Political Discontent:
a) Decline of Traditional....
Ecological Impacts of the Dust Bowl
The Devastating Effects of Dust Storms on Plant and Animal Life
Soil Erosion and the Loss of Agricultural Productivity
The Long-Term Ecological Legacy of the Dust Bowl
Economic Impacts of the Dust Bowl
The Collapse of the Agricultural Economy in the Great Plains
The Migration of Farm Workers and the Rise of Migrant Labor Camps
The Government Response to the Economic Crisis and its Lasting Impact
Social and Cultural Impacts of the Dust Bowl
The Psychological and Emotional Toll of Living Through the Dust Storms
The Rise of Dust Bowl Literature and Art
The Cultural Legacy....
Essay Topics Related to the American Dream
Historical Perspectives:
The Evolution of the American Dream: How the concept has changed over time and within different groups.
The American Dream in the Founding Documents: An examination of how the Constitution and Declaration of Independence shaped the dream.
The American Dream during the Great Depression: How the economic crisis impacted the pursuit and perception of the dream.
The American Dream in the 1950s: An analysis of the post-war prosperity and its influence on the dream.
Economic Dimensions:
The Role of Social Mobility in the American Dream: The extent to which economic opportunity and advancement....
Chapter 1: Ancient Civilizations
The Rise and Fall of the Sumerian City-States
The Indus Valley Civilization: Unraveling the Enigma
The Ancient Egyptian Civilization: Pyramids, Pharaonic Power, and Daily Life
The Minoan and Mycenaean Civilizations: Maritime Masters of the Aegean
The Zhou Dynasty and the Birth of Chinese Civilization
Chapter 2: Classical Civilizations
The Athenian Golden Age: Democracy, Philosophy, and the Arts
The Roman Empire: Conquests, Governance, and the Pax Romana
The Mauryan Empire: From Chandragupta to Ashoka's Legacy
The Hellenistic World: A Syncretic Blend of Greek and Persian Cultures
The Han Dynasty: China's Ascendancy and Technological Innovations
Chapter 3: Medieval Civilizations
The....
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