why is america in a recession...Assist me with this

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JoyRiderUSA

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I have to answer a question cause were doing a mock presidential election in my us government class towmorrow in my high school and I dont pay attention to politics or the government but someone answer this question into a way I a 16 year old can understand: why is america in a recession?
 
Oh...Sorry just wanted help with this speech. Google is no help and I cant understand anything I just need reasons why were in a recession google cant even answer that.
 
Actually debt doesn't factor into economic performance as much as you'd think. In fact, if Alexander Hamilton hadn't created the national debt, we wouldn't have an American economy at all.
A good source of information is this book:
[ame="http://www.amazon.com/Getting-Off-Track-Interventions-Institution/dp/0817949712"]http://www.amazon.com/Getting-Off-Track-Interventions-Institution/dp/0817949712[/ame]
Basically, the fed set interest rates far too low, and it caused a bubble. Then you have all the shorts and devaluation bonds by the investment firms. When the bubble popped, the government freaked and stepped in, doing the exact wrong thing at the exact wrong time (AIG credit rating- made no sense, and destroyed an extremely prosperous firm for no reason)
The reason we aren't getting out is that the government has made great strides in creating an environment hostile to investment- tax raises, inflation,bracket creep, a return of the Neo-Classical Synthesis, the SEC attacking Goldman-Sachs for DOING ABSOLUTELY NOTHING WRONG, the new finance reform bill which will finance new legislation by shutting down small business investment (which creates jobs at a rate 40 times that of the Fortune 500).

*EDIT* Here's a video of the author of the book I suggested discussing the book and his findings-
[ame="http://www.youtube.com/watch?v=J3UsiM8d45E&feature=related"]http://www.youtube.com/watch?v=J3UsiM8d45E&feature=related[/ame]

BTW- this is not politically biased- neither the current nor previous administration have acted correctly.
 
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This speech is hard I been working on it for over 7 hours and have only gotten 3 topics out of 8 done...
 
America is in recession for a lot of reasons.****

1) Other countries buy our debt with promised interest, even though it's unlikely we'll pay them back...Or at least right now.***
2) Authorities spend useless and countless money on things that don't matter. ie; Florida spent nearly 1 billion dollars on a monorail that won't benefit us at all.
3) The "war", because of certain individuals, we have lost a lot of innocent lives and a lot of money.**
4) Warheads, we give the military a lot, and I mean a lot of money for no reason. We have just spent 6 million dollars on building a missile that completely annihilates everything, even though we have 8 under our sleeves right now.
5) I hate to say it and I am glad we're helping, but Haiti has contributed a lot to our debt. Since Haitians moved to Florida, the jobless increased by 1.2% in Osceola County.*
6) Robots. Yes, believe it or not, Honda(Team Asimo) has an incredibly smart Robot. They have estimated that robots, in the future, will replace our jobs. Robots serving us in restaurants, robots assisting doctors on the surgery board and so forth. So we spend money on robots we don't have for them to take our jobs.

Personally, I believe America will fall to debt or initiate a war with other countries that will destroy this country or it'll be "everyone against everyone" and we'll end the world. It is proven that America, as a Super Nation, has enough missiles to blow up the world 4x. It's just a matter of time and patience.

I'm sure there is more, but that's the easiest things I could think of without you having to decipher paragraphs or watch boring videos of our economic state.


**If this offends you, I apologize.
****These reasons are based on statistics and what I know, I am not qualified to be a debt examiner or hold any legal position in America.
*I mean no disrespect to any other country or inhabitants, this is just the proven truth.
***In May 2009, the US owed China $772 billion. Total everything up and we owe a total of 3750.5 billion dollars to countries.
Click to expand...

The 2010 Budget proposed by President Barack Obama projects significant debt increases, both in terms of dollars and relative to GDP. The debt is projected to nearly double to $20 trillion by 2015, but is expected to increase to nearly 100% of GDP by 2020 and remain at that level thereafter. These estimates assume real GDP growth (after inflation) ranging from 2.6% to 4.6% annually from 2010 through 2019, which exceeds Blue Chip consensus estimates.
Click to expand...
 
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recession

Definition

Period of general economic decline, defined usually as a contraction in the GDP for six months (two consecutive quarters) or longer. Marked by high unemployment, stagnant wages, and fall in retail sales, a recession generally does not last longer than one year and is much milder than a depression. Although recessions are considered a normal part of a capitalist economy, there is no unanimity of economists on its causes.
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Source- http://www.businessdictionary.com/definition/recession.html

Is specifically what one is.

As for why it happened, google Goldman Sachs and read about them and what they did. They sold investments they knew would bomb out in value to people and called them valuable. They short sold (bet against, where if the value goes down, you earn money) the stock in this, which made it more profitable the worse the economy did.


Its hard to explain this without getting highly political. Google will have the answers you need for this though.
 
blackhawksniper said:
Source- http://www.businessdictionary.com/definition/recession.html

Is specifically what one is.

As for why it happened, google Goldman Sachs and read about them and what they did. They sold investments they knew would bomb out in value to people and called them valuable. They short sold (bet against, where if the value goes down, you earn money) the stock in this, which made it more profitable the worse the economy did.


Its hard to explain this without getting highly political. Google will have the answers you need for this though.
Click to expand...

OR, as said before, you can pay attention to the world around you and in your school classes. ;)
 
[ame]http://www.youtube.com/watch?v=k0lc1dg8MVg[/ame]
This explains it decently, nothing too crazy political more on the side of the average Joe. If you want to stop/slow down a recession there's some basic steps. The most obvious is being: don't overuse/abuse your creditcard.
 
Let's just try to get this back on track before we lose this thread.

Anyone else have any ideas about why America is in the recession?
 
If you none of you can keep it civil and on topic to the original point of this thread, it will be gone.
 
Ok I think this thread has gotten a bit sidetracked, so I'm just gonna make some quick points-
1. Blackhawk, shorting is the most time-honored investment strategy there is. Everybody does it. The U.S. Government does it (yes they really do). If it's ok for them, its ok for Sachs (and as for the misrepresentation thing- they also bought into everything they represented as a good investment- they weren't intentionally screwing people over.)
2. Debt was not the reason we are in a recession. AT ALL. Low interest rates created a bubble, it burst, then well-meaning but wrong-headed government intervention made that a recession.
3. Government debt and spending do have their effects on the economy, BUT THEY ARE NOT THE ECONOMY! High national debt is no part of the definition of recession.
4. That video (with the third-best economist in Alabama with a GPA of under 3 in high school-Lawl) was misleading. He bashes non-Keynseians (they're called supply-siders) a lot. But here's something interesting- by the time he died, Keynes had decided that many of his theories were wrong. Keynes had become a non-Keyneseian. Also, when he asks what have the non-Keynesians gotten us? Thirty years of sustained growth known in economics as the Great Moderation. It was when Keynsians stepped in that we got the current recession.
 
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