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A series of emergency measures enacted by the Federal Reserve (on its own authority) and Congress after heavy prodding by presidents Bush and Obama resulted in trillions of dollars in loans, banking bailouts and guarantees, a half-trillion new stimulus spending and a third of a trillion in tax cuts, but by mid-March 2009 the outlook remained bleak as the economy continued downward. Therefore the Federal Reserve announced yet another trillion dollar plan on March 18, this one to buy $300 billion in Treasury bonds, and $750 billion in mortgage-backed securities. The idea was to keep mortgage rates low in the hope people will start buying houses again, but the problem is that the prices are falling, so that if a person buys a $500,000 house today it will be worth $400,000 in a year, despite the Fed's intervention.
A series of emergency measures enacted by the Federal Reserve (on its own authority) and Congress after heavy prodding by presidents Bush and Obama resulted in trillions of dollars in loans, banking bailouts and guarantees, a half-trillion new stimulus spending and a third of a trillion in tax cuts, but by mid-March 2009 the outlook remained bleak as the economy continued downward. Therefore the Federal Reserve announced yet another trillion dollar plan on March 18, this one to buy $300 billion in Treasury bonds, and $750 billion in mortgage-backed securities. The idea was to keep mortgage rates low in the hope people will start buying houses again, but the problem is that the prices are falling, so that if a person buys a $500,000 house today it will be worth $400,000 in a year, despite the Fed's intervention.
In the first quarter of 2009 (January 1 to March 30), GDP fell sharply n major countries compared to the fourth quarter of 2008. In the US GDP was down 6.3%.
In the first quarter of 2009 (January 1 to March 30), GDP fell sharply in major countries compared to the fourth quarter of 2008. In the US GDP was down 6.3%.
Major export countries have seen their markets shrink. Exports from Japan were down 41% (quarter one 2009 versus 2008), Germany 32%, China 20% and U.S. 22%.
Major export countries have seen their markets shrink. Exports from Japan were down 41% (quarter one 2009 versus 2008), Germany 32%, China 20% and U.S. 22%.