How did events in America cause the UK to go into recession?
June 26th, 2010 by
Ive got an assignment and although i understand the concept of globalisation im still not sure exactly how the US housing market affected the UK. Ive heard that Lehman brothers and other investors have assetts here in the Uk but can someone be more specific and explain which firms have assetts where and other factors of how the events in the US made the UK go into recession.
Try not to give Generalised answers and 1 liners please and be specific.
10 points up for grabs thx.
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UK did it all by itself
Banks invested in subprime mortgages.House prices went down
money lenders panicked bingo we all went under.
Too much contact with robbing, lying, bas*ard Bankers! There’s more than enough research material available on this but there you have it in a nutshell!
Obama was elected.
no one liners?
I’m going to completely ignore that.
No, Lehman Brothers had to go so that Morgan could buy Merrill, which it didn’t even want. This is what happens when the government is in charge. AIG is the real culprit, since that’s the US’ funnel of money to other countries. It’s the collapse in the mortgage market that caused it because that was the underlying security for so many derivatives and credit default swap transactions. Can you say the US housing bubble? It’s like your South Sea bubble and subsequent collapse. And lots of countries have those types of transactions at AIG, so we, globally, have to prop them up.
Banks had bets on loans and other banks held bids on these loans which other banks originally had invested in…Hedge betting, this went on for years with some of the bids where made with a head in the cloud outlook, being made simply to ensure that the bank employees got their expected bonus quotas, in the end the whole house of cards fell quicker then the twin towers and the dust is still settling at the feet of the worlds investors.
The cause was the greed of these betting banks that raised a fever over making money from out of thin air, with the overseeing authorities standing recklessly by because they didn’t wish to be the messenger that blew too hard on the shaky foundations nor upset the tax revenue the betting was earning for the Governments.
As always it will be the poorest who will be shown the Immense bill for their raging greed whilst the rich calmly sail on to their next depression building scam that will know doubt earn them more wealth which they can add to the pile that is already 3/4 of the worlds total.
His name is Gordon Brown.
Everybody blames America for everything that goes wrong in their silly little countries. During the next war, and its coming, and soon at that, hopefully we’ll be smart enough not to bail everyone out like we did in WWII.
Let them all fight for themselves.
They cannot pay their debts, government and private. Banks and investment companies from other countries who invested in Americans’ debts have lost out, part or all of their money. Hence, bank bailouts in most countries, except Canada, and recession.
Credit supplied to the US housing market came from around the world and it tightened globally after the housing bust in the US.