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What The Great Depression Can Teach Us About Today's EconomyBY: Guest | Category: Finance | Post Date: 2010-01-30
The recent economic troubles that the United States has experienced have brought to mind memories of the Great Depression. The Great Depression began on what is known as 'Black Tuesday' on October 29, 1929, the day that the stock market crashed. From this day, the financial markets around the world declined. From Wall Street to Main Street, finances were affected. Families and individuals were also hard hit. The unemployment rate reached twenty-five percent in the United States. The definition of a depression is fuzzy at best. Dictionary.com defines an economic depression as a period during which business, employment, and stock-market values decline severely or remain at a very low level of activity. While this is not an authoritative definition, it does demonstrate that people's definitions of a depression could vary widely. The Great Depression of the 1930s and 1940s eventually came to a close after President Franklin Delano Roosevelt instituted 'The New Deal.' This package of a variety of programs helped to jump start the economy, but it can be argued that the key piece of the puzzle was the Second World War beginning in December of 1941. The high profile of the war and the urgency to supply soldiers for the war and workers to fill the gap they left back home, created a drastic increase in both the rate of employment and the gross domestic product. Though we are still in the midst of economic hardship in the United States, it is easy to draw parallels between the Great Depression of the 1930s and 1940s and today. Though we are probably still too close to the even to pinpoint the exact issues that caused it and have been affected by it, there are many ideas about these issues that have been proffered. The collapse of the sub-prime mortgage industry, the indebtedness of the United States economy, and the failure of ratings agencies to accurately assess the risk in assets such as sub-prime mortgages and 'creative' accounting procedures each played a part. There have been many ideas about how to pull the country out of its current recession. Perhaps one of the most well-publicized has been the 'American Recovery and Reinvestment Act of 2009,' also known as the 'Stimulus Bill.' This bill was passed in February of 2009 and included $787 billion dedicated to different projects throughout the United States which, in theory, would create jobs. Though the results of this bill on the overall economic status of the country are yet to be seen, the opinions of the bill are varied. On one side are those who see the bill as a resounding success; Recovery.gov is a government-managed web site that tracks the money that is being spent via the bill. This web site claims that 640,329 jobs have been created or saved by this bill as of October 10, 2009. Critics of the bill say that many of these jobs are short-term. Some jobs have been shown to be double-counted (though it is not known if the current job count has been modified to correct this error). Another critique is that the E-verify system has been removed from the system for new jobs that were promised with the act. With this development, it is estimated that 15% of the jobs from this bill will be filled by people who are in the country illegally. No matter what side of the aisle you sit on, it remains to be seen what the long-term effect of this act will be on the current recession. Long-term comparisons to the Great Depression will need to wait. Article Source: http://www.writearticles.org About Author / Additional Info: Additional Articles: * The magic of Uttam Kumar and Suchitra Sen * China Visa Types * Finding Something Truly Unique on the Internet * Helpful Tips to Reduce Baby's Teething Aches and Hurts * Technology :The Bobcat Machine: Modern and Functional For Heavy Duty Jobs Does this article violate or infringe on your copyright ? It is a violation of our terms for authors to submit content which they did not write and claim it as their own. If this article infringes on your copyrights, then use our Contact us form with the detailed proof of infringement along with the offending article's title, URL and writer name. If you do not hear back from us then contact us again in another 10 days. Thank you. Comments on this article: (0 comments so far) * Additional comments are now closed for this article *
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