Current Economic Situation in America Essay

1051 WordsJul 28, 20125 Pages
Current economic situation in America, America’s economy has emerged from a terrible economic recession. Despite the recent research in the banking field, little is known about the causes of financial crisis in America. Observers still hold on different opinions on what was the cause of this crisis that left multinational companies on the mercy of the federal government to bail them out. This study highlights the main cause of Americas’ current economic situation crisis as fear, and speculation by major market players. The federal bank is the main reserve in the country and has the sole duty to avert this crisis by Price control/ stability, create high employment, facilitate economic growth and development, create interest rate stability, and financial market stability. The bank failed to avert this crisis by allowing loop holes in the financial sector by enacting to many policies, and exposing the financial sector to the corporate world. To avert a repeat of this crisis in America, and other Europe countries, The European Union introduced a new banking model with the introduction of the euro to cushion the economy from a sudden meltdown, and reduce the causes of sudden financial crises . Monetary policy in America is implemented by the federal bank of America it chooses the type of legal notes to be used by the country at all times . Monetary policy has the following goals: Price control/ stability Financial crisis is cause by fear of inflation that leads to lenders losses. This anticipation is curbed by the monetary policy and maintain confident to all the lenders. A steady rate of inflation is maintained if the policy will be successful . If at all Americas’ federal bank had put down enough regulations to cushion American citizen from this crisis. The country could have realized a strong growth in the year 2009. High Employment The countries microeconomic
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