Ross Englert Ms.

Caruso English 1102-059 2/16/12

The History of the Great Recession

In December of 20071, right before President Bush was about to leave office, the United States was hit hard by an event that will impact the current generation for many years. The elections were coming to an end and the battle between Candidate Barack Obama and Candidate John McCain was on the final stretch to the finish line with Barack Obama ahead by a couple inches2. The elections were intense but once over, the winner, our current President, Barack Obama did not know what he had in store for him4. Both candidates had great intentions for America to pick up after George Bushs little miscues however an unexpected crash in the market occurred. This was the start to the Great Recession5. Many Americans didnt even know what a recession meant. A recession is a decline in economic activity. It is a period shorter than a depression, during which there is a decline in economic trade and prosperity. With the stock market crashing6, it deserved more than just the title the recession. Scientist, political figures, congress, bankers, and so on7 knew this was a very serious ordeal that wasnt something you could just fix in a day or two. Many people suffered from the happenings and as a result many people lost their jobs, houses, possessions, family, and many other important assets in their lives9. (Islam, Iyanatul, and Sher Verick 253) Three main reasons would be: an unhealthy stock market, growing unemployment, and a slump in personal income.10 This would take years to repair.8

The biggest and most well known problem that sparked the Great Recession would be the crash of the stock market. So much went wrong that its tough to decide where it all began11. In early October of 2008, Dow Jones took a dive for the worst12. Dow had record setting numbers across the board with the main one being net loss. This is where researchers, scientists, observers, political figures and so on have stated the beginning of the Great Recession. With Dow taking its worst hit since being established, the stock market came to a startling halt and crashed13. Dow Jones numbers affected majority of banks14 making business seem impossible. (Twin 1) JP Morgan and Wachovia had the hardest time15 when Dow went down causing Wall Street to become an absolute mess. With the stock market crashing and businesses shutting down, unemployment shot up to a record high in the past 4 years. Many states set records during the Great Recession for unemployment rates. (Rugaber) Some examples would be when Vermont went from a record low of 3.8 in 2000 to a whopping 14.4 10 years later in September of 2010. Also North Carolina16 had its most successful year in 1999 with the unemployment rate at 3.1. However, 2 years ago in February of 2010, NC set a record high of 11.2 with the unemployment rate. NC has dropped down to a 9.6 now however its still one of the highest numbers amongst the states. There are around 300,000,000 current US citizens. 15,000,000 of that number are currently unemployed.17 6,200,000 of that number have been unemployed for half a year, only 27 weeks. 1,400,000 of the 15 million have been unemployed for 2 years. (Franada) When the market crashed, many companies were forced to go out of business. Some were saved by merging with other companies and the best example of that would be Wachovia, a huge bank in 2006 and 2007 that was forced to merge with Wells Fargo18 or they wouldve gone out of business. Mergers saved many businesses from going completely out of business however, in the long run, they were bought out by another company so everyone had to adapt to new jobs, new locations, and even new positions. This was arguably the worst part of the Great Recession according to many people.

If you were lucky enough to keep your job it didnt mean you had an advantage on anyone. (Holder 2) Although the goal was to keep your job19, majority of people had their paychecks cut down dramatically20. Businesses had to reduce pay to stay in business. Even though they had jobs, they were working for a lot less. With this, many people had to downsize on their ideas. Foreclosures starting popping up around every corner and many families had to downsize to smaller homes to keep from going complete bankrupt.21 This also affected belongings such as cars, boats, gifts, and many other necessities in the American Dream.22 To other families, reduced pay paychecks had larger effects on people sometimes resulting in fights which lead to divorces. Around 2006, the divorce rate hit its peak. It has slowly reduced in the past couple years, but, at the beginning of the recession many couples ended up filing for divorce. As you can guess this tore families apart making life even worse in the economic times for the couples, kids, family members, and even close friends. The sad thing was, all America could do was sit back and watch. Between unemployment and reduced pay checks, peoples hopes, dream, and values were all being destroyed by the Great Recession. (Schwarz 4) Now the bright side to all of this is that we survived.23 There have been many moments in history when it seems like America was not going to recover from a specific situation. In bold letters the Great Depression stands out the most.24 We were close to being worse economically in the Great Recession than the Great Depression however we were able to stay on our feet and get back in business. Kelly Gavins title of her online article speaks for itself in a time like this: "The Recession Is Over. The Real Pain Starts Now.25" A lot of economists can agree with this because we went through the one of the worst times in history yet we survived and now we must build from it. Its time to get America back on its feet. It will take years to recover from and only time will tell if we are improving or not but the scary part of it all is looking back on what it has done then looking forward and seeing how it will affect us for the years ahead. It seems like the Great Recession took the biggest hit on the middle aged generation26 who have had to work or fight through all of the Great Recession without any income what so ever.

Most economists are starting to disagree with that now. Looking ahead, economists are predicting that the Great Recession will actually hit the youth of today27 harder than it hit the middle aged citizens. Its scary to think what the US will be like years from now. Like said earlier, only time will tell. We can predict all we want however no one will know until its actually here. Its amazing how one thing can lead to another and end up as a disaster. The importance of Dow Jones and the stock market in general has stood out over the past couple of years. Living through the Great Recession is one thing, but recovering is going to be an even bigger challenge.28 We have learned from past experiences29 how to handle a situation like this but times are different now a days. Technology, society, economics, and the way of life all have a huge impact when it comes to recovering from this disaster. The causes and effects of the Great Recession have destroyed more peoples lives30 than made better. That will most likely continue for years to come.31

Work Cited
1) Schwarz, Benjamin. "Life In (And After) Our Great Recession." Atlantic Monthly (10727825) 304.3 (2009): 91-98. Literary Reference Center Plus. Web. 8 Feb. 2012. 2) Islam, Iyanatul, and Sher Verick. From the great recession to labour market recovery. New York: International Labour Office, 1/6/11. Web. 12 Feb. 2012. 3) Rugaber, Christopher S. "Tax Cuts, Benefits Set to End." The News and Observer [Charlotte, NC] 23 Nov. 2011: 1A, 13A. Web. 13 Feb. 2012. 4) Holder, Sara. "Corporate Dreams: Big Business in American Democracy from the Great Depression to the Great Recession." Library Journal 136.13 (2011): 106-107. Literary Reference Center. Web. 12 Feb. 2012. 5) Kelly, Gavin. "The Recession Is Over. The Real Pain Starts Now." New Statesman 140.5035 (2011): 24-27. Literary Reference Center Plus. Web. 13 Feb. 2012. 6) Franada, Sam. "The Great Recession." Focus. 2011. Web. 2 Feb. <http://www.focus.com/images/view/45988/>. 7) Twin, Alexandra. "Stocks Crushed." CNN Money. CNN, 28 Sept. 2008. Web. 5 Feb. 2012. <http://money.cnn.com/2008/09/29/markets/markets_newyork/index.htm>.

End Notes
1

This will be the starting point in my movie. I want to start off with a TV playing the elections. On the TV will be one of Obamas Speeches. The character in my movie is going to be a huge Obama fan. My lead role in the movie will show signs of concern towards fixing George Bushs last second mistakes. At the beginning of the Great Recession, there were a lot of predictions and people knew what it

meant however no one knew how it would affect people or what was in store.
6

The first thing on the top of newspapers, on TV, being talked about, and so on is going to be about the

stock market crashing.

7

My character is a Banker so clearly I will show how he is affected but I also want to include the others

that were affected. To do this my characters closest friends will be involved in some way with congress, political figures, economists, etc.
8

People doubted how long it would take to recover. Early in the movie Im going to make it seem like its

no biggie but then I will show how hard everything hit when I get midway through 2008.
9

One by one, my character will start losing important things in his life due to the recession starting with

his job.
10

There are 3 main topics when it comes to the recession so far. In my movie I plan on stressing these

topics.
11

There is going to be a lot of confusion in the world early on because no one though this could be really

happening.

12

The stock market is a confusing mess. I dont understand how it all works and I plan on learning

sometime soon however I know Dow Jones was a huge part in the crash so I need to incorporate it whether its on TV or in the newspaper.
13

My main character will start to get the fear inside of him that he will be losing his job when the stock

market crashes.
14

All banks were in danger when the stock market crashed. To make things intense and crazy, In my

movie all of the banks will be in danger of going out of business.

15

I plan on using Wachovia or JP Morgan for my characters place of eployment. I plan on using uptown Charlotte as one of my main settings. Unemployment is one of the biggest issues in the Great Recession. So many people were unemployed

16

17

and I plan on showing this in my movie.

18

Wachovia merged with Wells Fargo so my character will have a second chance at getting his job back. I plan on showing the fight and struggles for keeping a job during the Recession with my characters

19

friends.
20

Even if you didnt lose your job, you still didnt make much to live off. I will emphasize on this through

my characters friends as well.

21

In the Great Recession you either had money or you didnt have anything. Companies fought so hard

to avoid going bankrupt however most couldnt get out of the way.

22

One of my all-time favorite lessons in school was the American Dream. I want to use the American

Dream in my movie. My character will achieve it then lose it and have to get back on his feet and on the right path back to the Dream.
23

The challenge in the Recession was to survive with a positive amount of money in your pocket. Everyone related to the Great Depression. No one wanted America to go through another Depression

24

so im going to show the fight against going through another Depression.

25

I will use this title in my movie as a sign that my character will survive and make it in life. This is the age group for my movie. I plan on showing that even though the middle aged group was hit the hardest things were about to

26

27

get real rough for the youth of America. Their futures would be questioned do to the Recession.
28

It was the hardest challenge for many people to make it through the Recession. Some people found success through the Recession. These people came prepared. My character will

29

receive advice from someone who was improving while everyone was doing terrible.
30

My character will get to a point in his story where he reflects on what he went through. Achieving,

failing, fighting, surviving, and achieving once more.

31

My character will find his way back on his feet with a better future ahead of him. He will find success

once more and will have one heck of a story to tell.