Is it true that the States is better? Is it really the greatest economy the world has ceased to fall, and was revived? Is it true that Japan, Germany, France, Britain and Russia out of the recession? Or is this just the voice of propaganda, which seeks to give wishful thinking?
Economic Truth "continues the cycle of material devoted to analysis of the major economies, in times of financial crisis.
All that was said about the other economy, three times for the United States. States are world leaders in supporting the economy through government programs. Not knowing what to do, the Americans focused their programs in two directions from which grew the current crisis. First - the real estate market. The second - the financial sector.
Emerging crisis in the U.S. from 2002 to 2006. During this time held in the housing market boom. Real estate market and related mortgage grew by approximately 50% per year, although he grew up to ten percent per year.
With the boom in the housing market has increased "bubble" as an issue of so-called securitization instruments. It is a process, when issued loans issued bonds, and collected money from their sales of new loans granted.
Later, when issued bonds issued derivative instruments - derivatives. Financial market into the U.S. for several years in a huge ball of tangled up in the hundreds of billions of dollars.
Decompose it was absolutely impossible, and more investors relied on the rating, rather than common sense. Even in Ukraine until recently been considered that there is nothing more reliable in real estate.
It was a world legend, inflated without any reason. Rating assessment in multi-issue were certainly the highest. It formed a critical mass of explosive assets, which broke out two years ago.
At the beginning of the 2007 bubble burst in the U.S. housing market. Today, its fall was about 40%, and money loss reached 4.5 trillion dollars. In one fifth of all mortgages issued by the difficulties a year after their issuance. Problems with payment loans are, according to various estimates, from 8.5 to 20 million American families.
As a result, real estate prices began to fall, and banks have to write off losses. Happened vicious circle: as a result of writing off losses grow rate, through a growing number of families could not pay for the loans through a obvalyuvalysya real estate prices, banks spysuvaly loss, and so at first.
Not to mention that turned into dust several stories of financial instruments, players are quite on this dubious and problematic loans. "Burned" trillions of dollars of pension, mutual and hedge funds, and they will never return. Disappeared as a type of inter-bank market in the United States.
The peak of problems in the financial sector were: purchase of Bear Stearns (March 16, 2008) bank JP Morgan Chase; introduction of special surveillance breathing incense to Fannie Mae and Freddie Mac (6 September); bankrupt Lehman Brothers (September 16); sale Merrill Lynch (middle September), another giant - Bank of America; peredbankrutnyy state of the world's largest insurance company AIG, which is to keep afloat got 85 billion dollars from the Fed; bankruptcy largest U.S. savings bank (late September).
Disappeared as the investment banking business. Of the five major New York investment banks left only two - Goldman Sachs and Morgan Stanley. And as a result they have become almost commercial banks to use refinancing Fed.
Problems in one sector gradually spread to the U.S. economy first and then the world economy. In late 2007 dramatically "styslosya" loans, and rates have increased.
Companies found themselves without money, and they minimize investment and pursue liberation. Constant rising default rates on corporate bonds. Many people have professional jobs. As a result, decreased demand of the U.S. economy, and more chain crisis has affected the whole world.
Record-holder support pants
Fed infest the economy with money, substituting missing billions after the revaluation of assets:
Interest rates are very low. Fed could prevent a rise in so-called prime rates - rates for corporations with the highest ratings:
Began to increase even the U.S. stock market, which is always perceived as leading indicators of future growth:
At all times the major advantages of American power was their speed and determination. If the task to rescue the economy, all Government immediately mobilized and began work. The decision was taken a few days.
So it was in 2008. Here are a few high-profile names of government projects, which ever entered the vocabulary of millions of Americans:
- American Recovery and Reinvestment Act;
- "Making Home Affordable",
- Financial Stability Plan;
- Fraud Enforcement and Recovery Act;
- Helping Families Save Their Homes Act;
- Credit Card Accountability, Responsibility, and Disclosure (CARD) Act.
In the variety of anti-crisis program dollars can be lost. Financing are separate from one another and the Federal Reserve and the government.
Fed to fight first. Back in 2007, she began to cut interest rates today, reducing them to levels 0-0,25% and in 2008 - literally "flooded" the banks affordable refinancing.
Also, the Fed implemented a "credit easing facilities" for reviving the issue of consumer credit and money market. And the U.S. central bank has bought the assets of problem banks.
Later the Fed focused on buying "toxic" securities related to mortgages and bonds, U.S. Treasury. First, the Fed was planning to buy agency securities backed, amounting to 1.45 trillion dollars before December 31, 2009. Weekly banks received 20-25 billion.
Also in March is a program where each week the Fed purchased Treasury Bonds on 5-9 billion by the end of 2009 for their miserly 300 billion. These funds go directly to fund housing programs of the government.
Even at 200 billion should be skupleni agency debt. Today, the Fed has already spent to purchase securities secured by mortgages, 741.6 billion. All this is done to reduce the cost of borrowing for U.S. households.
Government debuted in October 2008 with the program Hope for Homeowners. She introduced the Federal Housing Administration guarantees and opportunities for decent borrowers whose mortgage costs amounted to no more than a third of revenues.
The program was the first glass, which went terms. A very high demands to the candidates it has failed. Today, the 400 thousand families, it benefited only a thousand.
However, other programs were more successful. Treasury to prevent panic gave state guarantees depositors money market funds in which invested trillions of dollars of ordinary Americans. Also, the state increased its coverage of the return of deposits from 100 thousand to 250 thousand dollars (equivalent Ukrainian Deposit Guarantee Fund).
In early 2009 the Treasury announced the launch of the legendary Financial Stability Plan, which includes stress tests of banks, injecting capital into them buying problem assets. The plan began to be implemented immediately.
In October 2008 the Government introduced tax breaks for those buying homes for the first time. Then zapustylasya famous Troubled Asset Relief Program (TARP) - software buy toxic assets at 700 billion.
In February 2009 introduced a package of fiscal measures up 5% of GDP in 2009-2011. With coordinated with G-20 strategy, the U.S. had urizannya taxes, increase spending on infrastructure and have provided assistance to individual states, whose revenues have fallen.
Today Obama administration set itself three priorities. First - to increase employment. This purpose serves American Recovery and Reinvestment Plan. It stimulates the creation of 3.5 million jobs, and even allows investments in health, education, acquisition of new energy, upgrading buildings and infrastructure.
Second priority - maintaining homes of ordinary Americans. This involved the February Making Home Affordable Refinancing program (program refinancing "Making Buildings Available"). Three of its directions accordingly affect 4 to 5, from 3 to 4 and 9 million households.
The third priority - the stabilization of financial markets. Under this goal, for example, allocated 15 billion dollars in grant loans to small businesses. Trifle, but works.
As in the world, one of the most successful anti-crisis program was saving market. Late in 2008 automakers Chrysler and GM have filed for bankruptcy, and several months long journey of their transformation. A July 24 entered into force in the exchange program of old machines to new cash-for-clankers ( "cash for junk).
According to her, consumers can take the old car, and get discounts when buying new to 4.5 thousand dollars. This is a significant sum, given the cost of cars in the United States. For example, full-size SUV Ford Escape sold for 20 thousand, and the giant crossovers from General Motors are sold at a price of 24 thousand.
Replacement program was successful. With its help, Americans receive about 250 thousand new cars. Overall U.S. auto sales for July were a record from the middle of 2008, and Ford Motor Co sales grew by 2.3%. Dedicated to the program of one billion dollars was spent during the month, and Congress recently added to these two.
From the exotic, since 2008 the U.S. began fighting for the return to the country with money offshore. Exemplary punishment staged a demonstration, the Swiss bank UBS, which opened the accounts of thousands of Americans.
In August New York Times wrote that the 150 U.S. bank customers indicted in tax evasion in the United States. Newspaper individually focused, so far it is unclear where the U.S. government has received the names of clients.
It has come to that in February, UBS agreed to pay 780 million dollars and transfer data on about 250 U.S. customers to remove themselves from the accusations. Today the governments of the USA and Switzerland to discuss whether to force the bank to disclose the names of 52 thousand wealthy Americans suspected of tax evasion.
The case is the fact that the Swiss government refuses to primary values of his country - secrecy of bank deposit. Any investigator of any country will soon learn that bill and that amount open to any inhabitants of Switzerland.
The most interesting is that on the eve of similarly committed Britain and Germany to Liechtenstein. But after the Americans information on bills 3 thousand of its citizens in Switzerland and France demanded.
We do not know which button clicked largest state. But Switzerland and Liechtenstein, decades and even centuries kept secrets of their clients without a fight suddenly passed object of national pride. Now in Switzerland remained cheese, chocolate and watches. In the only remaining emblem of Liechtenstein Principality.
Did not avoid populism. Was adopted Fraud Enforcement and Recovery Act, which the state began to investigate practices and operations that led to the financial crisis.
Under the act was a special Financial Crisis Inquiry Commission. And to protect Americans from unfair claims of banks on credit cards, the government accepted Credit Card Accountability, Responsibility, and Disclosure (CARD) Act.
"The current crisis - the result of long-term irresponsibility, both from the government and the private sector. Looking to the future, we must build a defense on many fronts this crisis and lay the foundation of a new era of accountability and transparency" - freshly written on the economic page White home in a country that dictates the world how to be accountable and transparent. "
Where to go States?
Price of such an active anti-crisis is known. Texas spends more than before. On October 1, the budget deficit rose to 1.267 trillioniv dollars, although the same period in 2008 it was only 388.61 billion.
The cost of combating recession are increasing. In July, the hole in the budget of the U.S. was a record 181 billion dollars. In May, the White House said the budget deficit for the entire 2009 fiscal year may rise to 1.84 against tryllyonov 455 billion in 2008. But in August decided to just "Shrink". It was scary.
End of August, Obama told the administration that will reduce the forecast budget deficit for fiscal 2009 to 1.58 trillion dollars. However, not by reducing costs, but by removing him 250 billion allocated to rescue troubled banks. Another 78 billion would be saved if the bankrupt banks will be less than expected.
The decision was political. Americans who lost in the number of anti-crisis programs began to be afraid of obvious things - raising taxes. The government and the Fed is spending trillions, but they have to compensate residents of the country.
In addition to fear such a practice could impede Obama's plans to modernize the health system, education reform and reducing country's dependence on fossil fuels. Only health care reform requires a trillion dollars.
Now Obama administration said that the priorities for the current administration is to curb the budget deficit. Negro president, referring to the Americans promised to cut the deficit in half before the end of his four-year term as president.
Fed also wants to reduce spending to "stimulate the economy not too. In late August the leaders of the federal states of two banks said that the U.S. central bank should consider phasing out programs to support the economy in the coming months and consider whether to bring the end of all scheduled programs.
Specifically, the Fed wants to sell some assets, which it bought for 2 trillion since the beginning of the crisis. These operations will "remove" with the economy the extra dollars that can stimulate inflation.
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