Americans socio economic crisis has worsened with President Trump’s entry into American politics. The few months in The White house has seen many turbulent economic crisis unfold.
What is Economic Crisis?
The term ‘economic crisis’ is known to be a complex one and hence it is difficult to define in a simple way. This short article is primarily intended to educate the readers about the overall picture of US economic crisis and its effects and other implications on the whole community. According to the experts, the economic crisis in America is known to be severe and had a great impact on the people of America. The impact includes inflation, unemployment, slow down of banks, downward trends of the stock market and so on. America has encountered this type of economic crisis more often, and it is hard to eliminate since the causes are entirely different in each time when the crisis occurs. Also, such crisis has a long-lasting effect on the people as well as the whole country.
Before moving further, let us know some basics of the event – Economic Crisis. Most people have a misconception about this event that it is not good for the country. Here one should understand the fact that operating a country is very similar to running a business, where crisis occurs due to several reasons like market, employees, productivity, and lack of finance and so on. The most important thing is how the crisis is handled whether in business or country. At a macro level, the economic crisis is known to be measured in accordance with the natural phase of each economic cycle. Ignoring or not taking action on the crisis will lead to the recession. America had faced such a recession few times when markets were freezing, and people are losing their homes.
In the recent times, America has witnessed few economic crisis events in the year 2008. The symptoms of this 2008 financial crisis were seen in the year 2006 when real estate sector has started seeing a downward trend, and the mortgage defaults have been increasing. This has also resulted in the bankruptcy of few insurance firms. Finally, the bank stopped lending for mortgages as the crisis has started worsening gradually. The 9/11 attack has made things worse as NYSE did not operate for more than a week due to the severe attack. As per experts, America has seen much economic crisis which includes 1989 loan crisis, recession in 1981, stagnation during the 1970s and the oldest one being the 1929 great depression. All these crisis events have a common factor which is the fall of stocks in each event of any economic crisis.
Economic experts in America say any economic crisis can be handled in a better way at the micro level by using few simple protective steps which include:
• Paying all credit and debit cards bills before time.
• People can save around six times of their monthly income as a cushion so that leading a normal life will not get affected when the economic crisis strikes.
• Hire a financial planner so that one can be proactive in the aspect of a mortgage.
• Ensure to have a wide portfolio to determine your asset allocation.