July 9th, 2010 
Business and Financial
Since Wall Street started tumbling and the U.S. economic crisis came in the open in September 2008, it has an impact on the world. This disaster and the collapse was not for this country alone, limited the impact on the world to feel.
It is aptly described as a global recession.
the American economy and the global economy
volatility and uncertainty are at this time in the widespread financial markets.
The growth rate of the world, has slowed aos economy.
China with double-digit growth rates for the last four years. However, the growth rate has fallen to ninth 0 percent in the quarter, according to the National Bureau of Statistics. This decrease is primarily due to the unstable international economic situation.
Similar reports are from Japan, are the second largest economy in the world. The Bank of Japan is Japan, AOS central bank. It is expected aos Governor Masaaki Shirakawa, stagnation of economic growth of the country as a result of the fallout from the economic recession in the countries around the world.
With the American economy, the development in the various States of America and its lending to other developing countries and the overall state of affairs in the United States has a direct impact on the economic situation of the other major countries in the world.
From current U.S. data, new home sales in the United States fell to its lowest level since the recession in 1991.
Critical Appraisal
The ongoing global financial crisis has many similarities to the Great Depression of the twenties. Major changes such as bank failures, tightening credit crisis plunged mergers of banks and financial institutions, falling stock markets and some financial giants Tumbling cause similar feelings to those that during the joint that depression was.
However, the big difference is that there is no great change in day to day life of the common person. The Great Depression pushed millions of families in extreme poverty.
Today, while a large number of severe distress are suffering, most people still able to purchase goods that operate ATMs, and the extent of the loss of jobs is not as massively this location.
Some experts say that this shows the current crisis is more of a financial adjustment and subsequent panic, rather than a complete economic meltdown.
This is still extensive damage on Wall Street caused Institute. But so far the effects have been felt not as deep as during the Great Depression.
The story has been a great teacher. Politicians, bankers and others in Federal Reserve, Treasury and elsewhere are aware of how all this could translate and bring the changes in the economic scene. They try their best to alleviate as much of the depressive effects and reduce the number and impact of plant closures and stressed.
Although the world economy is currently experiencing immense uncertainties, there are certain safeguards within the economy as a result of the Great Depression to help.
Unemployment rates were as high as 24th 9% in 1933. The current interest rate is 6 1%. It may take up to 7% and 8%, which has serious implications go directly involved, but is much less than during the Great Depression. have
Most banks are Federal Deposit Insurance. Most investors have no risk of losing their money. Foreclosure problems limited to subprime mortgages alone.
currently about a third of homeowners have a clear and free title. The present Federal Reserve is not on the gold standard.
Interest rates can be reduced to increase the liquidity.
The current tax structures are not entirely progressive. These are the automatic stabilizers in the system.
The effects of dollar depreciation in gross domestic product can be reduced by taxes and the automatic increase in government expenditure are balanced.
There are some safety nets in place after the lessons learned were provided from the Great Depression.
These include the Securities and Exchange Commission to protect investors and stock exchanges to regulate unemployment insurance, deposit insurance and various social security measures.
All these help to ensure greater flexibility in the financial markets.
This can help the global economy to recover faster and reduce the rate and degree of adverse events in markets around the world.
The assessment shows that there are definitely a recession, but not all convinced that we might have, or experience a depression.
Many feel that the world economy will bounce back after two or three quarters and things are looking up, start slowly.
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Sources:
The Federal Home Mortgage Response to Distress: Lessons from the Great Depression by David C. Wheelock
America ’s Greatest Depression 1929-1941, by Lester V. Chandler National Association for Business Economics
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