Reasons for Drop Down in the US Economy – Essay Example
The paper "Reasons for Drop Down in the US Economy" is an excellent example of an essay on macroµeconomics.
The economic recession has resulted due to a host of reasons. First, the oil prices soared to a new level altogether. This sparked unrest in nearly all the industries. Then the issue of mortgage and housing crisis gripped the US and other developed nations. This made headlines for all the wrong reasons and it resulted in the economy going down drastically. The jobs were cut, the taxes were estimated to be increased and the inflation touched new heights. Such was the case within the economy that even the rich had sleepless nights since they were losing out on their profit-making regimes. The economy thus had a lot of negatives with itself which essentially had the basis for its downfall.
The drop down in the economy has also resulted due to the fact that people have been generally skeptical of their investments and have thus pulled out their money or held back for better times. This has meant that the economy has lost the holding power which is essential under crunch times. The investors, both big and small have not had confidence in the economy and its future, even though they knew beforehand that this dropdown is for a very short time period. (Schnurr, 2008) If they could have sustained the pressure, the world would not have suffered so much. The oil prices are back to normal, from where they started and now the need is to have a check and balance mechanism over their proper understanding and implementation within the global market regimes.