The Crash of 2007-2008
23/08/07 13:18 Filed in: Economy
The immediate triggers are being described quite
well: the collapse of the U.S. subprime mortgage
market; the vulnerability of the rest of the economy
to the subprime undertow, due to the “efficiency” of
the markets in spreading risk; the worldwide
overextension of cheap credit; the failure of large
institutional investors and Wall Street brokerages to
behave responsibly; and the long-term effects of the
U.S. trade and fiscal deficits which are now coming
home to roost.
Amazingly, some commentators have been asking “if the monetary crisis will affect the producing economy,” and whether a recession lies ahead. In reality, the U.S. producing economy has been in a recession for the last year. This is shown most clearly by the decline in M1, the portion of the money supply immediately available to people for making purchases.
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Amazingly, some commentators have been asking “if the monetary crisis will affect the producing economy,” and whether a recession lies ahead. In reality, the U.S. producing economy has been in a recession for the last year. This is shown most clearly by the decline in M1, the portion of the money supply immediately available to people for making purchases.
Read Full Article
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