Death Of The Salesman
Nowadays, economy of the America is not in a good condition. It slowed down, which brought to the current Economic Crisis. Last Tuesday there was a panel discussion, which I attended. There were given many ideas about the crisis. I agree with most of the experts who thought that the primary cause of the crisis is the mortgage crisis. What is a mortgage? Generally, a mortgage is a loan of money to the home owner secured by a “lien” on the real estate.
The crisis began with the bursting of the United States housing bubble and adjustable rate mortgages. I think that banks of America began to give credits more than market value of the real estate. By giving those loans banks thought that people could spend remaining money on the improvements of the housing. That kind of giving loans is very risky, which brought to the crisis. First, according to the panel, financial institutions such as Fannie Mae, Freddie Max and Bear Stearns collapsed because of the empty mortgages.
It became easy to have credits and people started to buy more houses, which caused housing market to collapse and prices increased. According to the panel “not only did consumers buy houses they couldn’t afford, bad mortgages were packaged with good ones and sold back and forth between banks”.
There is another problem that crisis caused which is low worth of the houses. For example, people who had a house which worth $300, now could be $ 250.
Panel was very interesting. Panelists helped me to understand the current economic crisis clearly. I heard different opinions but I liked more the opinions of the Jeffrey Miron, who is director of Undergraduate Studies at Harvard University. I think he is more realistic to the problem. He did not agree with the Federal Government. Miron was for the deregulation and that it would give institutions false security. I liked a lot his one phrase stating that “ If you don’t let things fail, capitalism is a...
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