The Crash of the Housing Market and its Effects on the Labour Force - Essay Example

Comments (1) Cite this document
Summary
This paper finds that the literature with regards to specific aspects of this paper’s topics is limited. For instance, it was difficult to stumble upon sources the industries that were least affected by the recession and how the most recovered industries recovered from their hit. This paper, therefore, advises for further research into these topics…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER95.2% of users find it useful
The Crash of the Housing Market and its Effects on the Labour Force
Read TextPreview

Extract of sample "The Crash of the Housing Market and its Effects on the Labour Force"

Download file to see previous pages The United States crash of the housing market was an unconstructive event that transpired and led to a financial crisis, as well as a subsequent recession, which started in 2008. The occurrence, officially referred to as the subprime mortgage crisis, was typified by an increase in subprime mortgage foreclosures and delinquencies and the resulting drop of market securities backed by alleged mortgages. These MBS and CDO – mortgage-backed securities and collateralised debt obligations, respectively, formerly granted appealing rates of return because of the greater rates on the mortgages, but the slightly lower credit quality eventually lead to massive defaults. Whereas factors of the financial crisis became clearer during 2007, a number of major financial organizations collapsed in September 2008, with considerable interference in the credit flow of these organizations and their consumers, along with the start of a harsh global financial crisis (recession). The financial turmoil had long-lasting effects to the United States and European financial systems. The United States, in particular, fell into a deep recession with almost 9 million jobs lost from 2008 to 2009, nearly 6 percent of the nation’s workforce.
...
licies to endorse affordable housing, poor local and state governmental programs and mark-to-market accounting principle), role of Freddie Mac and Fannie Mae, poor policies by the Federal Reserve (American central bank), high debt levels and incentives of financial institution, credit default swaps, the trade deficit, technology and globalisation and finally the boom and subside of the shadow banking schemes (Wall 5). As from 1997 to 2006, the peak period of the American housing bubble, the value of a normal American house went up by 124% (Wallison 51). Between 1980 and 2001, the ratio of normal home values to normal household salary, also known as the measure of someone’s capacity to purchase a house, shifted from 2.9 to 3.1 (Wallison 51). By 2005, the ratio had increased to 4.0, and, by 2006, it hit a high of 4.6. This housing bubble made fairly a few property holders refinance their homes at much lower interest rates or back customer spending through taking out other mortgages secured through the price appreciation. The United States household balance, as a fraction of yearly disposable personal revenue, was a stunning 127% by 2007, against 77%, in 1990 (Wallison 51). Effects on the Labour Force The ILO estimated that roughly 20 million positions will have been lost by the close of 2009 because of the financial crisis, particularly in the construction, financial services, real estate and auto industry, bringing world joblessness rate over 200 million for the initial time (Wallison 56). The number of unemployed individuals the world over was over 50 million, in 2009, as the world recession intensified. By the end of 2007, the United States joblessness rate was 4.9%. By late 2009, the rate had hit a high of 10.1% (Wallison 56). A wider measure of the unemployment ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“The Crash of the Housing Market and its Effects on the Labour Force Essay”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1497073-the-crash-of-the-housing-market-and-its-effects-on-the-labour-force
(The Crash of the Housing Market and Its Effects on the Labour Force Essay)
https://studentshare.org/macro-microeconomics/1497073-the-crash-of-the-housing-market-and-its-effects-on-the-labour-force.
“The Crash of the Housing Market and Its Effects on the Labour Force Essay”, n.d. https://studentshare.org/macro-microeconomics/1497073-the-crash-of-the-housing-market-and-its-effects-on-the-labour-force.
  • Cited: 0 times
Comments (1)
Click to create a comment or rate a document
hb
hbuckridge added comment 3 days ago
Student rated this paper as
At first, I thought 6 of pages is too much for such a question. But now I see it could not be done smarter. As the author starts you see the difficulty of the subject. I’ve read all at once. Wonderful text

CHECK THESE SAMPLES OF The Crash of the Housing Market and its Effects on the Labour Force

Analyzing the Stock Market Crash

...closed for four days and the tourism and Airline industry were highly affected by these attacks. The last crisis to-date occurred in 2007 which is also known as ‘Credit Crunch’ which started due to housing bubble in United States. US developed a policy of easy credit to people who wanted to buy American houses due to which many people raced towards buying houses with borrowed money from banks. However, the bubble bursts and people became highly indebted. These were the financial crisis that had severely damaged the global economy and has still its effect on the economy of the world. Recommendations to Prevent Stock Market...
39 Pages(9750 words)Dissertation

Australia Housing Market

...? Australian Housing Market Insert Australian Housing Market Introduction Property ownership is a mater which usually is considered with a lot of seriousness in the society. The fact that it relives individuals and the families off the stress of paying mortgage besides securing their future is reason enough for individuals to strive for this goal. The ever increasing population and the desire for individuals to access decent housing has made the search, for properties more intense and even the current recession hasn’t stopped this. Australia like other nations has a more or less the same situation. Sydney, the capital city of Australia is considered to...
3 Pages(750 words)Admission/Application Essay

Housing Market in U.S

...of credit underwriting standards attract many borrowers in the market. In this case, a decline in demand due to high interest rates and a tightening of credit standards leads to bursting of the bubble. This paper discusses in depth about the rise and fall of the housing market in U.S. and its impact in the society. Scholarly research depicts that an economic bubble is difficult to identify with the exception of in hindsight. However, a number of cultural and economic factors have led to justification of the argument of several economists that a housing bubble existed in the U.S. As an economic bubble, the United States housing bubble...
6 Pages(1500 words)Essay

Labour market

...heavy taxes will shut down the businesses. AUSTRALIAN LABOUR MARKET Introduction There are several ways through which a person gains human capital. However, the two main ways are education and the second is experience or on the job training. Various skills are required to perform different jobs and the basics skills are acquired through studies or formal education. However, without experience or practice the education is not as effective. Therefore, even at work, the worker is always in the process of learning. Considering the level of skills in the labour force in Australia, the government has been consistently undertaking various projects to support...
6 Pages(1500 words)Essay

European Labour Market

...and other bodies like IMF and Word Bank has been for France to tighten its generosity on unemployment benefit. This is seen as the first step that is likely to force many of those who are currently under the benefit to go out and seek employments. This is also likely to help the government to save some of the resource that can be used in financing projects that will help in creating employment for the population. Recent performance of the labour market in France The rate of unemployment has remand at around 10% and for the last twenty year, threat has been floating at the same level fluctuation in between the single and double digits even at the time when France was...
21 Pages(5250 words)Essay

Housing Market

...need to be determined. 7. All extensive data collection has to be taken from the specific local areas, which requires extra control of the variables on which the location choices are based. Therefore, the variables must be accurately chosen, to eliminate the variable biases, and to decrease the problems of multicollinearity. The further avoid difficulties in measurements, the proposal given in the articles divides Great Britain into smaller geographical areas, where the local amenities like the climate variables vary, but they are adjusted with the local housing market, because the labour market can not be modified (Englin, 1996). Gayer (2000) took an instrumental...
6 Pages(1500 words)Essay

Housing market in China

..., the downward pressure on the housing market is reflected usually in shrinking transaction volumes rather than in the collapse in nominal prices as owners refrain from selling at a loss. As noted, housing price fluctuations can also be driven by macro factors and intrinsic characteristics of the housing market itself. Empirical evidence suggests that the market has its own distinct dynamics. Almost three fifths of the overall variation in housing prices is explained by innovations in the housing market itself. The combined effect of other explanatory...
20 Pages(5000 words)Case Study

Labour market analysis report

...or persons to fill that specific position. Thus, let us say that Coles has an organizational chart for its Asian food department in a Melbourne branch. One category is indicated as that of a saleslady. Whoever will be assigned to become that saleslady must have sufficient knowledge about Asian food. Similarly, somebody with a good education, skills and training background in make-up and other personal care products and beauty items and with sound leadership qualities must be assigned as the manager of a certain health and beauty department. Generally, it cannot be expected of an accountancy graduate or of a civil engineering degree holder to effectively perform in that kind of work. To make the...
7 Pages(1750 words)Lab Report

Labour market

...and life style of the employee. Organizations thus need to adopt an approach that is geared towards addressing the various forms of flexibilities that is being witnessed in current times. This essay mainly tries to highlight, the fact that due to various labour market flexibilities, the rate of job insecurity is increasing and may lead into serious consequences in the labour market (Rodgers 2007, P.41). Critical analysis Flexibility in the labour market can be described as the ability of an organization to make amendment to its labour force concerning the number of employees employed as...
12 Pages(3000 words)Essay

Labour market

...essential for the employee as well as the employer. This is because; it might help to reduce the rate of unemployment or redundancy as well as bankruptcy ratio. Hence, labour market flexibility acts as a catalyst that offers equal balance within the employees and the employers of an organization. Orthodox view of Labour market flexibility As per neo-liberal thoughts, an organization might include various rules and regulations in order to maintain and control its labour forces. However, it is done, to maintain the efficiency and performance of the labours that may prove effective for...
12 Pages(3000 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Essay on topic The Crash of the Housing Market and its Effects on the Labour Force for FREE!

Contact Us