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Q: Some argue that the Federal Reserve lowering interest rates from mid-2000 to the end of 2002 greatly increased the money supply; however, opportunities to invest yielded paltry returns leading
bankers to offer _____ in order to earn a higher return.
A: Answer: Many factors directly and indirectly caused the ongoing Great Recession (which started with the US subprime mortgage crisis), [ with experts placing different weights upon particular causes. The crisis resulted from a combination of complex factors, including easy credit conditions during the 2002 2008 period that encouraged high-risk lending and borrowing practices; international trade
imbalances; real-estate bubbles that have since burst; fiscal policy choices related to government revenues and expenses; and approaches used by nations to bail out troubled banking industries and private bondholders, assuming private debt burdens or socializing losses. [1][2] One narrative describing the causes of the crisis begins with the significant increase in savings available for investment during the 2000 2007 period when the global pool of fixed-income securities increased from approximately $36 trillion in 2000 to $80 trillion by 2007. This "Giant Pool of Money" increased as savings from high-growth developing nations entered global capital markets. Investors searching for higher yields than those offered by U.S. Treasury bonds sought alternatives globally.[3] The temptation offered by such readily available savings overwhelmed the policy and regulatory control mechanisms in country after country, as lenders and borrowers put these savings to use, generating bubble after bubble across the globe. While these bubbles have burst, causing asset prices (e.g., housing and commercial property) to decline, the liabilities owed to global investors remain at full price, generating questions regarding the solvency of consumers, governments and banking systems.[2] Struggling banks in the U.S. and Europe cut back lending causing a credit crunch. Consumers and some governments were no longer able to borrow and spend at pre-crisis levels. Businesses also cut back their investments as demand faltered and reduced their workforces. Higher unemployment due to the recession made it more difficult for consumers and countries to honor their obligations. ]
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User: Some argue that the Federal Reserve lowering interest rates from mid-2000 to the end of 2002 greatly increased the money supply; however, opportunities to invest yielded paltry returns leading bankers to offer _____ in order to earn a higher return.

Weegy: Answer: Many factors directly and indirectly caused the ongoing Great Recession (which started with the US subprime mortgage crisis), [ with experts placing different weights upon particular causes. The crisis resulted from a combination of complex factors, including easy credit conditions during the 2002 2008 period that encouraged high-risk lending and borrowing practices; international trade imbalances; real-estate bubbles that have since burst; fiscal policy choices related to government revenues and expenses; and approaches used by nations to bail out troubled banking industries and private bondholders, assuming private debt burdens or socializing losses. [1][2] One narrative describing the causes of the crisis begins with the significant increase in savings available for investment during the 2000 2007 period when the global pool of fixed-income securities increased from approximately $36 trillion in 2000 to $80 trillion by 2007. This "Giant Pool of Money" increased as savings from high-growth developing nations entered global capital markets. Investors searching for higher yields than those offered by U.S. Treasury bonds sought alternatives globally.[3] The temptation offered by such readily available savings overwhelmed the policy and regulatory control mechanisms in country after country, as lenders and borrowers put these savings to use, generating bubble after bubble across the globe. While these bubbles have burst, causing asset prices (e.g., housing and commercial property) to decline, the liabilities owed to global investors remain at full price, generating questions regarding the solvency of consumers, governments and banking systems.[2] Struggling banks in the U.S. and Europe cut back lending causing a credit crunch. Consumers and some governments were no longer able to borrow and spend at pre-crisis levels. Businesses also cut back their investments as demand faltered and reduced their workforces. Higher unemployment due to the recession made it more difficult for consumers and countries to honor their obligations. ]
marissa-sarol|Points 111|

User: Which of the following would be studied in the greatest detail in a macroeconomics course?

Weegy: Macroeconomics is the study of large business economics.
wisbest|Points 2811|

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Asked 9/9/2013 10:16:56 PM
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