What were the effects of the policies implemented in

Question

The financial crisis of 2008 caused macroeconomists to rethink monetary and fiscal policies. Economists, financial experts, and government policy makers are victims of what former Fed chairman Alan Greenspan called a "once in a century credit tsunami"-in other words, nobody saw it coming.

Based on the analysis of the data, share your thoughts on what caused the financial crisis and whether the United States is going in the right or wrong direction with its current policies.

Focus specifically on the following:

Monetary policy

What monetary policies do you think caused the crisis?

What were the effects of the policies implemented in reaction to the crisis?

Do you think the solutions worked in the short term? In the long term?

Fiscal policies

What fiscal policies do you think caused the crisis?

What were the effects of the fiscal policies implemented in reaction to the crisis?

Do you think the solutions worked in the short term? In the long term?

Make sure you include the following concepts in your analysis:

Interest rates

The financial services industries (CDOs, CMOs, the stock market, credit flows, money markets, etc.)

Tax rebates

Stimulus

TARP

Government debt and deficit

Inflation

Unemployment

GDP

In your opinion, did government intervention help or harm the economy before and after the panic of 2008? Would you have done

anything differently?

Answer 1

Analyze the financial crisis of the year 2008 which caused macroeconomists to re-consider monetary and fiscal policies. On the basis of data, express your opinions all along with the present policies. You must focus particularly on the given: Q1. What monetary policies do you suppose caused the crisis? Q2. What were the consequences of the policies applied in reaction to the crisis? Q3. Do you suppose the solutions worked in the short term or in the long term? Q4. What are the fiscal policies which do you think caused the crisis? Q5. Name the effects of the fiscal policies implemented in reaction to the crisis? Q6. Do you suppose the solutions worked in the short term or in the long term? Q7. In your thought, did government intervention help or harm the economy before and after the panic of year 2008? Would you have done something another way?