Great Recession in the United States The great recession was the worst time for most of the countries during the late 20’s and early 2010’s. Many developed and developing countries faced a continuous decline in their financial markets during this recession. The financial markets collapse, scarcity of resources occurs, unemployment level rises, and poverty increases, banks defaults, and many other factors explain the phase of recession in different world countries. The economy of US was hit harder by the recession. Before the recession, the economy of United State was stable with an increasing rate in GDP. People were satisfied and the economy was progressing. The government policies were working properly for the welfare of the economy. Due …show more content…
The United States incurred a net loss of 3.617 million jobs in 2008 and a net loss of 5.052 million jobs in 2009. The decline in the GDP of United States can be shown through the given graph. Due to the rise in unemployment, decrease in inflation, decrease in wages, the overall aggregate demand declines which show a decline in GDP. In 2007, GDP contracted by 5.1%, making the worst great recession. This fall in GDP was the huge in the history of United States. The other crises came due to recession is liquidity crises. The banks default bankruptcy due to failure in finding the investors and buyers. The venture funding of capital slows down which causes the unemployment and slowed new job creation. The other factors which help the recession to boost include the lending of loans from the financial sector and the all sectors are linked with one another and the dollar value in the world market. The federal chairman advised the secretary treasures to stabilize the financial system by increasing public lending which includes stocks and bonds. About 799 financial stocks were sold in the public to overcome the repercussions of recession. In 2008, the new loans, purchases, and Federal Reserve liabilities help the United States to bail out the financial crises. The Federal Reserve had kept interest rates low at 0.25%, as