Business US Has Faced Acute Economic Crisis Essay

Open, View, and/or
Download this Document

Total Length: 946 words ( 3 double-spaced pages)

Total Sources: 2

Page 1 of 3

Business

US has faced acute economic crisis since 2008. Present economic crisis started from the downfall of housing sector which lead to the financial crisis such as bankruptcy of Lehman Brothers (at that time fourth largest investment bank in the U.S.A.) and bankruptcy of largest insurance in world, the AIG (which were later saved by introducing bailout packages by U.S. government) which further collapsed production and unemployment plummeted. It is usually termed that it is the worst economic crisis since the Great Depression. (Moseley, 2009)

Even though Fed Reserve claims, the crisis has averted to some extent but the problems of unemployment, recession and inflation still prevails in U.S. economy.

According to U.S. Bureau of Labor Statistics, the unemployment rate staggers to an amount of 8.3% in February 2012. Similarly, U.S. Bureau of Labor Statistics also shows that consumer price index is on upward swing in 2012. Recent wave of agitation under the banner of "Occupy Wall Street" is also embodiment of high unemployment rate prevailing in U.S. economy.

Bernake (Chairman Federal Reserve) says, the U.S. job market remains weak despite recent three months strong hiring. Moreover, he says that further job gains require more policies that are robust. (Economic Crisis, 2012)

Marxist Theory can explain position of U.S. market; it says the significant decline in the rate of profit is the main cause of the twin evils of higher unemployment and higher inflation and hence, lower real wages experienced in recent decades.

Stuck Writing Your "Business US Has Faced Acute Economic Crisis" Essay?

View All Our Example Business US Has Faced Acute Economic Crisis Essay

Have A Custom Example Essay Written

As in the past periods of depression, the decline in the rate of profit reduced business investment, which in turn resulted in slower growth and higher rates of unemployment.

Moreover, international rating agencies like Standard and Poor's have downgraded U.S. credit rating in 2011, which has sent shivers among the international investors, reduces investment from all across the world.

American government has responded to this economic crisis through bailout packages and through fiscal and monetary policy tools. However, so far it looks that bailout packages were only beneficial to prevent the economic crumble down but it has not been able to restore the growth rate. In 2009, President Obama told the Bankers, "I am the only one who is standing between you and the pitchforks, the bankers got the bailouts, they were supposed to extend credit, extend mortgages .They did pretty much nothing and they went back to same actions as before, making money through trading. At this point, I think people are fed up with it. Rightly or wrongly, there is huge amount of anger." (News.....

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"Business US Has Faced Acute Economic Crisis" (2012, April 05) Retrieved May 2, 2024, from
https://www.aceyourpaper.com/essays/business-faced-acute-economic-crisis-79041

Latest MLA Format (8th edition)

Copy Reference
"Business US Has Faced Acute Economic Crisis" 05 April 2012. Web.2 May. 2024. <
https://www.aceyourpaper.com/essays/business-faced-acute-economic-crisis-79041>

Latest Chicago Format (16th edition)

Copy Reference
"Business US Has Faced Acute Economic Crisis", 05 April 2012, Accessed.2 May. 2024,
https://www.aceyourpaper.com/essays/business-faced-acute-economic-crisis-79041
   

Open, View, and/or
Download this Document
order custom essay example