Why are the banks and stock market crashing ?

Question

I thought that under the Republicans laws we have deregulated them to spur competition and lower prices to the consumer. All the big money was suppose to "trickle down" to the less fortunate. What happend, just another Republican lie?

Do we need regulation back? This mess is going to cost the taxpayers billions, and yet another derpression?

So much for the results of Reaganomics.

Answer 1

There's way too much emphasis on corporate favoritism and specifically in corporate profits. Further, both the legislative and executive branches have been extremely pro-business in this administration. Thus, when business profits go up, there is more of an incentive to play games with the profit and the books. Mortgage houses were playing big games with their profits right up until the sub-prime loans began failing. It doesn't take a rocket scientist to figure out that lending to people who can't afford to pay will lead to default.

As far as 'trickle down' there was no intention for that. That was all political lip service, as it always is. What a specific Republican said was just used to get into office, not to keep the economy afloat. When you have a President who's financial interests are deep in oil (before even getting into office), you can easily expect conflict of interest.. and Bush hasn't failed to disappoint on that. Gas prices are astronomical and he always makes it appear as if it's not his fault. But, how can it not be? He already had personal financial stakes in oil before taking the office. If oil profits soar, then so does his bank account.

So, it's no wonder we are where we are. When the country can be run by people who are continually in financial conflict of interest, there can be no possibility of a properly run economy.

Answer 2

What happened was the working man got screwed!! The bush administration opened up fair trade all around the world. this means that if china pays their employees $10 to make a car and we pay our employees $30 to make a car, America no longer charges them tax to ship their car here to sell. Now the china car is much much cheaper than the American car so people buy the cheaper car to save money. While saving money they kill American buisness. American companies can't afford to make cars here, so to try and compete they ship our jobs overseas to lower production cost. Now the American workers have no jobs because they have been shipped overseas. Basicly the rish got a extra boost in their income but cut their own throat in the process and the middle to lower class have begun to fall right out of the American economic system. The government is shitting them selves right now because the rate of inflation is sky high and they use housing tax as a way to counter it. They just receantly lowered the housing tax, but guess what, people still can't afford a new home because it is to little to late! Major reform is in need!!! Take this into consideration when you go to vote this election!! To make things worse when the working man cannot afford the things he has worked hard to get. The market becomes a buyers market for the rich. This means they get your things cheap because people get desprate to sell when suvivial is dependant on it. Good Luck and good question to post!!! People need to take an active role in politics because the quality of their lives depend on it!!!

Answer 3

no longer anymore they does not. Losses could have been liquidated and anyone could be lower back at artwork, people who stored could have lots extra of what they stored in genuinely buying capacity somewhat than set for deflation as human beings initiate spending lower back. there's a reason no person recalls the recession of 1920 to recover from the debt of WWI. It became allowed to ensue, became sharp, and over in a twelve months. human beings's long term decrease cost costs, no longer purely 'emergency money' are being drained in long term propping up of a equipment that advantages wall street and government deficit spending, yet on the cost of the yank citizen.

Answer 4

Because the flip side of people defaulting on their loans ,
Is that someone does Not get the $$$ back that they lent for the mortgage (like those mutual funds that many senior's pensions are in OR some folks 401Ks !)
So when the people who lent them $$$ don't get it back , their lives take a hit . ( and it is regular folks that have lots of savings in those institutions that made those risky mortgages )

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