Affront the Consequences.

2004 to 2006 were great years for the American economy. A lot of people were happy; the majority of the population was making a lot of money. Being a realtor, broker or hedge fund manager was the sexiest and most desired jobs in the nation. The real state bubble brought a lot of prosperity for people that were in the middle income bracket. The unemployment was really low and Mercedes and yachts were a common thing among cities like Miami and L.A but as my grandpa said “the easy money doesn’t stay forever”. This year has not been the best for our economy; the unemployment has risen to 6.1%. More than 14 banks have either declared chapter 11 or merge with a bigger company. The prices of energy and oil have rise to unbelievable prices. And know we may get into a depression if the government doesn’t approve the bailout plan. And you may ask why? Why is this happening? Wasn’t everything fine a year ago? I believe that the main reason for this problem is the greed of the big corporations. If you start digging in the way they were doing things you may find that it was not the best way. These companies were issuing loans to people that they know they couldn’t afford it. Changes of income and liabilities in loans applications were something common. Speculation was another thing that kills us. How is it possible that a house will double its value in one year, how it is possible that people were buying 4 and 5 houses when they were making a 45000 a year. Leveraging which is making a loan base on the cash that you have was something else that affect us. Fund managers were loaning 4 or 5 times the capital that they have to work in order to produce more profits. This is just some examples of the reasons of our economic downturn right now. There are a lot of thing to mention but it will take an encyclopedia to name them. Saving and being organized is the best thing to be successful in life. These people want to become rich in 6 months and look what It happens to them and to the country. This should be a lesson for the future generations. This cannot happen again if we want to keep being the most powerful nation on earth.