Assignment:
The 2008 Financial Crisis and the Performance of the U.S. Economy
Introduction
It is difficult to imagine studying the "global economic environment" without considering the causes and consequences of what is likely the most significant economic event since the Great Depression. In addition to being of interest on its own right, the crisis serves as a useful starting point for the course because our discussion of it will necessarily touch on core elements of the economic environment - such as the real estate market, the banking system, and the public policies meant to govern them - as well as key measures of national economic performance.
By the end of this week you will be able to:
1 Identify the main causes of the 2008 U.S. financial crisis.
2 Identify the three major indicators of national economic performance: GDP, unemployment, and inflation.
3 Recognize the effects of the 2008 U.S. financial crisis on the three major indicators of national economic performance.
Watch
The unemployment rate is another key univariate measure of national economic performance. Please watch this presentation to learn more.
If desired, the Unemployment transcript for this media piece is available.
A PowerPoint version of the Core Concepts of Unemployment Lecture is also available for your reference.
Read
Instructions
Read the following:
• Ferguson, Charles H. Inside Job (Links to an external site.)?Links to an external site.?. Sony Pictures Classics and Representational Pictures in association with Screen Pass Pictures. 2010. Note: Purchase streaming version or DVD from Amazon (Links to an external site.)?Links to an external site.?or other online sources for $10-$12.
• Hellwig, Martin. "The Causes of the Financial Crisis.?" CESifo Forum (4). 4/2008. 12-21.
• Zurcher, Anthony. "Secret Tapes Pull Back Curtain on Goldman Sachs.?" BBC News.
• Shiller, Robert J. "Booming Until It Hurts? Project Syndicate. July 15, 2014.
Discussion: The 2008 Financial Crisis
Instructions
Use this discussion board to discuss a team response to the questions that follow. After reaching a conclusion, elect one team member to post the final response to the board. Indicate in the post that it is the team's response.
Discussion Questions
1 What were the main causes of the real estate bubble and the ensuing financial crisis?
2 Why did the crisis spread from subprime mortgages to the entire financial sector and, ultimately, the economy?
3 How has the crisis been reflected in the United States' GDP growth rate, unemployment rate, and inflation rate? What do these figures indicate about the magnitude of the crisis?