The Financial Crisis Of The United States Economy Essay

The financial crisis was something very few people saw coming. We were in what seemed to be a good economic place before it, the housing market appeared to be healthy and our economy seemed strong. The financial crisis rocked not only the American people and the United States economy to its core, but the rest of the world as well. It was on the borderline of being a true catastrophic event. A myriad of unforeseeable events occurred leaving policy makers around the globe in a plight, reeling to figure out what actions to take to keep the global economy from collapsing. The financial crisis was mainly caused by the housing bubble and the domino effect that put in place. Our entire housing market was propped up on these terrible mortgages that were hidden within huge groups of mortgages. These groups of mortgages were rated higher than the content within deserved. It created a false sense of security in mortgage bonds. The banks were backed by these terrible CDOs and MBSs. The rating ag encies falsely rating these CDOs and MBSs worsened the issue. People no longer knew what they were investing in, because the erroneous ratings given by the rating agencies. It was no longer just our housing market being propped up on these subprime mortgages; it was now most of our large financial firms. Ergo, a large portion of our economy being propped up on mortgage pools that were bound to be defaulted on by the masses. Surely enough, the housing bubble did burst and left our economy inShow MoreRelatedFinancial Crisis Of 2008, The United States Economy1086 Words   |  5 PagesIn 2001, the U.S. economy experienced a mild, short-lived recession. 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In fact, no one can claim that the Great Recession and the global financial crisis have been under-researched. In fact, the new world recession has been analysed from different angles and perspectives. Historians, economists, financial experts, psychologists, anthropologists and other experts in academic, financial, economic