reason of recession?

Jump to Last Post 1-4 of 4 discussions (4 posts)
  1. profile image51
    yuwarajposted 8 years ago

    reason of recession?

  2. profile image0
    Phoebe Pikeposted 8 years ago

    Natural recession and an uneven proportion of wealth. Plus it didn't help that we got stuck with the "trickle down effect" for over 8 years (where the rich get tax breaks in hopes they will spend money in the economy to create jobs for the poor). That doesn't work because people tend to put their money where they will make more money and creating jobs isn't really a popular option for them...

  3. profile image0
    Dog On A Missionposted 8 years ago

    Central banks create inflation, which leads to a boom. When entrepreneurs discover that the "new money" does not represent new wealth, there is an inevitable deflationary bust.

    To make matters worse, central banks all over the world are currently in the process of inflating...which create another bust.

    Here we go again: … re=related

  4. TylerWill profile image58
    TylerWillposted 8 years ago

    In short, the main cause of the current recession and socioeconomic crisis was the huge increase in subprime adjustable-rate mortgages and the CDO's (collateralized debt obligations) that comprised them. The number of subprime mortgages issued in 2005 and 2006 increased dramatically while prime mortgages actually decreased. Basically banks loaned money to people who would obviously default on those loans.

    Mortgages are securitized by the gov't; they are pooled together and sold in blocks, which spreads the risk and uncertainty to those who take part. It created a huge widespread web of risk in that the securities are dependent upon their underlying subprime mortgage values. The value of the CDO's and their securities decreased and were miscalculated to begin with. Ratings agencies could not predict the value of them. This is why so many people lost their retirement which was largely based on these securities.
    Worst of all, the federal government encouraged the purchasing of these securities without knowing the underlying risk involved. The web of risk was worldwide, not just in the United States. Major institutions like AIG, Citi, Chase, Bear Sterns, etc. held many of these risky CDO's and when they failed everything that depended on them failed (ALOT!).

    Generally speaking, borrowing and lending also increased dramatically in the past few years. Despite what MANY people (noneconomists) think, inflation and the money supply put into circulation by the Fed are not really related to the whole situation at all.

    Tyler W.


This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

Show Details
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)