Essay On 2008 Financial Crisis

In early 2008, after a large financial bubble, the changing of credit, the ease of purchasing property, and the crash of the stock market, the financial crisis to follow afterward became extremely impactful on America as we see it today. Businesses lost money, which lead to people losing jobs, which lead to poverty all around the country. The most recent instability in the market in 2008 was caused by a multitude of factors. A few of the most influential causes were the changes to how credit worked, which affected the flow of money that kept the economy stable, and very cheap credit, which made it too easy for people to buy houses and make investments based on simple speculation. There are many examples that prove this, such as the bankruptcy of Lehman Brothers. There were also many factors that lead to stabilization of the economy after the financial crisis.

First we’ll talk about some of the causes and effects of the 2008 financial crisis. The changes on how credit worked were extremely impactful in the decimation of the

People would invest based on speculation - or the idea that if they invested correctly, they would make a fortune in the long run. However, too many people wanted to purchase the same stocks and invest in the same area, and because of supply and demand - the concept that the more people that want something the more it costs - prices went skyrocketing on specific stocks, and causing a bubble. This eventually caused the stock market to crash. Eventually people all wanted to sell their stock to “make it big”. All at once, people would sell their stock, and eventually everything swung the other way. The prices of stocks went way down, and people were trying to sell as fast as they could so it would still be worth something. But eventually, it was too late. Because of the price drops, a significant amount of “paper wealth” was