Question

What caused the great recession?

Answer 1

Edit

EditMany factors directly and indirectly caused the Great Recession (which started in 2008 with the US subprime mortgage crisis), with experts and economists placing different weights on particular causes.

EditMany factors directly and indirectly caused the Great Recession (which started in 2008 with the US subprime mortgage crisis), with experts and economists placing different weights on particular causes.Major causes of the initial subprime mortgage crisis and following recession include: International trade imbalances and lax lending standards contributing to high levels of developed country household debt and real-estate bubbles that have since burst; U.S. government housing policies; and limited regulation of non-depository financial institutions. Once the recession began, various responses were attempted with different degrees of success. These included fiscal policies of governments; monetary policies of central banks; measures designed to help indebted consumers refinance their mortgage debt; and inconsistent approaches used by nations to bail out troubled banking industries and private bondholders, assuming private debt burdens or socializing losses.

Answer 2

$\large { \fcolorbox{gray}{black}{ ✔\: \textbf{Verified \: answer}}}$

Great Recession refers to the economic downturn from 2007 to 2009 after the bursting of the U.S. housing bubble and the global financial crisis. The Great Recession was the most severe economic recession in the United States since the Great Depression of the 1930s.

The major causes of the initial subprime mortgage crisis and following recession include the Federal Reserve lowering the Federal funds rate and creating a flood of liquidity in the economy, international trade imbalances, and lax lending standards contributing to high levels of developed country household debt.