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Macro economic affecting business
Macro economic affecting business
What caused the Great Recession of 2008
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In the history of the World there have been bountiful recessions, some worse than other of course. This is simply the nature of the economy. The cycle of peaks and troughs in an economy, which every economy goes through, is called the business cycle. When you are in areas of peak, business is good. Gross Domestic Product or GDP, all the products made within your country in a period of time (normally calculated quarterly or bi-annually), is very high, unemployment rates are low, and the overall standard of living is elevated. But while the peaks of the cycle are great the troughs can sometimes be hash.
All over the news and the public chatter in the U.S. you hear about this depression/recession, which is a very bad trough phase of the business cycle. The official start of the current, or past depending on who you ask, economic shortcoming was in March of 2001. The peak date of the recession was determined by the NBER (National Bureau of Economic Research) was set in November of 2001. The quarter before hand was the first quarter of GDP decline. The decline went well into 2002. The slow but steady decline continued and was officially declared a recession in December of 2007 (Layton 6).
So how does a normal low period of business come to be a recession? Simply put, there are numerous factors that can ultimately cause this to occur. In this proposal I am not trying to inform you of all of these, but urge to you that one vertebra in the back bone of recession should be discussed and if altered could keep troughs, what they are and nothing more detrimental to the economic prosperity of our nation. The cause I am referring to is the ethics of the “major” corporations in the US.
When this country was founded, Quakers were the opti...
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Layton, Allan P., and Anirvan Banerji. "What is a recession?: A reprise (1)." Applied Economic
35.16 (2003): 1789+. Academic OneFile. Web. 18 Mar. 2010.
R. Edward Freeman, Lisa Stewart, Brian Moriarty. "Teaching Business ethics in the age of
Madoff." November-December 2009. Changemag.org. 19 Feb. 2010 .
Surowiecki, James. "A Virtuous Cycle.(importance of trust and honesty to capitalism)." 23 Dec
2003. Academic OneFile. 19 Feb 2010 .
"VIrtue ethics and the rise of the meaning economy: virtue ethics in tomorrow's business
world." August 2006. Academic OneFile. 19 Feb 2010 .
2007-2008-2009 global financial crisis - many people compared to the experience to another large scale depression - now coined “great recession”
By definition, an economic depression is a “sustained, long-term downturn in economic activity in one or more economies.” (http://en.wikipedia.org/wiki/Economic_depression) The latter, is far worse then a recession. A recession is merely an economic slowdown, which was experienced by most Atlantic Provinces in the late 19th century.
This paper aims to discuss the Short-Term and Long-Term Impacts of the Great Recession and
These conditions have the ability to cause recession. Now that an armistice has been reached in Korea, a recession is beginning to occur (Pach and Richardson, 54). I believe that the President’s chief concern should not be to make an immediate and fast acting restoration of the general economy. The problems of the federal deficit and the recession must wait until the more important problems are dealt with. The problem at hand is the rising rate of unemployment.
The July 1990- march 1991 recession lasted eight months and was caused by many different adverse financial problems on the environment in the early 90’s. Most post was recessions are short as this one was. They tended to last only up to eleven months at a time. On October of 1987 Black Monday occurred which caused the stock market to crash. The Persian war joined with the rising infiltration rates created this recession. When the recession began the Fed began to try to reduce infiltration, which then limited economic expansion.(Kevin Mulligan Recessions) Extreme changes in the GDP growth began to emerge at the beginning of 1990’s, however the overall growth seemed to remain positive. As a result of this recession a loss of consumer and business confidence was lost due to rising of oil prices along with an already weak economy.
December of 2007 saw the beginning of the worst economic downturn in memorable history; not since the end of the Great Depression in 1939 has the world seen such a devastating and long-lasting economic breakdown. The Great Recession shook the public’s faith in the capitalist system and silenced those who claimed a modern economy was impervious to another broad collapse like the one in 1929. Discontent and mistrust from the public has built not only with large corporations and the financial sector, but also with the government, whose legislature and policies in recent decades seem to coincide with the interests of private corporate power-houses. These lenient policies contributed directly to the recession that affected individuals across the globe. Stunted wages, increased poverty, massive income inequality, and unprecedented unemployment rates are just the start to a long list of consequences that continue to grow as the effects of the Great Recession continue to be felt by individuals all over the world.
Waggoner, John. "Is Today's Economic Crisis Another Great Depression?" USA Today. N.p., 4 Nov. 2008. Web. 7 Mar. 2014.
"The Great Recession." State of Working America. Economic Policy Institute, n.d. Web. 24 Apr. 2014.
Every few years, countries experience an economic decline which is commonly referred to as a recession. In recent years the U.S. has been faced with overcoming the most devastating global economic hardships since the Great Depression. This period “a period of declining GDP, accompanied by lower real income and higher unemployment” has been referred to as the Great Recession (McConnell, 2012 p.G-30). This paper will cover the issues which led to the recession, discuss the strategies taken by the Government and Federal Reserve to alleviate the crisis, and look at the future outlook of the U.S. economy. By examining the nation’s economic struggles during this time period (2007-2009), it will conclude that the current macroeconomic situation deals with unemployment, which is a direct result of the recession.
Looking back to the Carter and Reagan Administration’s, you can begin to see where the Recession originated from. Prior to the Reagan administration, the United States economy experienced a decade of rising unemployment and inflation. Political pressure favored stimulus resulting in an expansion of the money supply. Reagan wanted to increase defense spending while lowering taxes, Reagan's approach was a departure from his immediate predecessors. Reagan enacted lower marginal tax rates in combination with simplified income tax codes and continued deregulation. During Reagan's presidency the annual deficits averaged 4.2% of GDP after inheriting an annual deficit of 2.7% of GDP in 1980 under President Carter. The real
What caused the Great Recession that lasted from December 2007 to June 2009 in the United States? The United States a country with abundance of resources from jobs, education, money and power went from one day of economic balance to the next suffering major dimensions crisis. According to the Economic Policy Institute, it all began in 2007 from the credit crisis, which resulted in an 8 trillion dollar housing bubble (n.d.). This said by Economist analysts to attributed to the collapse in the United States. Even today, strong debates continue over major issues caused by the Great Recession in part over the accommodative federal monetary and fiscal policy (Economic Policy Institute, 2013). The Great Recession of 2007 – 2009 enlarges the longest financial crisis since the Great Depression of 1929 – 1932 that damaged the economy.
...ults of the recession. In order for this never to happen again, there is a need to learn from the mistakes in the past and to look for the warning signs. The problem is not just restricted to one country, but is a global problem and needs to be addressed as such.
middle of paper ... ... It is evident that although we may be entering into a recession on different terms than the one before, the United States is still in danger of once again becoming a victim of another Great Depression. The Great Depression is a time in the history of the United States that people have learned and gained knowledge from. Its harsh times and conflicts have been written about in books, seen in movies, talked about on radios, and told to families throughout the generations.
In economics, a recession occurs when there is a slowdown in the spending of goods and services in the market. A recession causes a drop in employment, GDP growth, investment, as well as societal well-being. All recessions are caused by a specific cause, but the Great Recession of 2007-2009 was caused by a crash in the housing market. This crash was triggered by a steep decline in housing prices. All of a sudden, people bought houses because there was an excessive amount of money in the economy and they thought the price of houses would only increase. (Amadeo, 2012). There was a financial frenzy as the growing desire for homes expanded. People held a lot of faith in the economy and began spending irrationally on houses that they couldn’t afford. This led to overvalued estate and unsustainable mortgage debt. (McConnell, Brue, Flynn, 2012).
Explain the connection between the economic model of corporate social responsibility and “free market” or “neoclassical” economic theory.