Is the United States in a Recession? You Bet! - Associated Content
According to a poll today on CNN, three quarters of Americans believe that our country is in a recession.
A 2-1 margin agrees that the Iraq war is the leading contributor to this situation. Only 46% of Americans believed that we were in a recession last October.
What CNN isn't saying is that many Americans from all financial levels are reaching for their dusty old history books from the 5th grade, and are beginning to brush up on our basics about what actually happened to cause the Great Depression. There was something about a stock market crash, but overall, our grasp of what causes a Great Depression goes something like this:
Prior to the Great Depression, Americans relied upon cheap credit to procure newly manufactured cars, furniture, and luxuries that resulted from World War 1 technologies. As Americans took out many small loans (similar to credit cards today) this created a period of prosperity showing.
As manufacturing and agriculture increased through the use of new technology, more of everything was available, so prices dropped. As people found themselves with home, car, business, and material goods loans to repay, while prices were dropping, they couldn't make payments.
Employment became scarce as businesses were closed, and as homes taken. People reduced their society into the Great Depression by believing that it would continue to grow beyond a high-point that never happened. Their goods depreciated in value instead of increasing in value making it impossible to repay debts.
Many people in this country today are living on credit for homes, cars, furnishings, food, business loans, and student loans. And we can all see the news.
Our paychecks are staying the same while our housing and gas prices rise. Going to college does not equate to a good paying job for many people; we now have degrees working in fast food because nothing else is available. Loans are not being repaid. People are losing their homes. Medical services are a luxury that some can't afford. The big Bear Stearns bank would have gone under if it hadn't sold for a token 2.00 a share.
