Macroeconomic Policies during the Recession of 2008-2009

Macroeconomic Policies during the Recession of 2008-2009 Renyuan Feng An Assessment of Macroeconomic Policies during the Great Recession of 2008-2009 Brief Introduction From 2008-2009, US economy suffered the severe recession from the impact of the global financial crisis. From 1990s, United States has experienced the huge amount of the saving inflows from the other emerging markets (Bernanke, 2009). However, the financial institutions invest these savings with the poor way to develop the sub-prime mortgage and push the real estate price increasing. The sub-prime mortgage loans were provided to the people with poor credit score as the no income, no job and no asset groups. Meanwhile, these bad loans were securitized in the financial market and traded as the financial instruments to provide numerous profits for the financial institutions and Wall Street bankers (Thomas, Hennessey, Holtz-Eakin, 2011). The low interest rate and the increase of housing price had provided new opportunities for these foreign saving inflows. The burst of housing bubble has led the high proportion of defaults on subprime mortgage. With the fall of largest financial institu tion, the whole financial system suffered the damage. Later, this financial crisis has become contagious into the global scale and finally created one of the most serious financial chaoses in the beginning of the new century. During these months, US economy has experienced the severe negative influences as the real GDP fell at a 6% annual rate and the employment positions have been reduced in the large amount every month. The usage of confusing financial instruments as credit-default swaps and collateralized debt obligations in the financial market has been blamed as one of the significant reasons for the crisis (Weisberg, 2010). Meanwhile, the other main causes for this Great Recession could be included as the international global imbalances, the low interest rate for the monetary policy, the lack of regulation for the new financial instruments and conflicts of interest in the financial rating agencies (Bernanke, 2009). Fiscal Policies in Action To deal with this economic recession, US government has passed the American Recovery and Reinvestment Act in 2009. The act aims to develop more new employment and maintain current ones, to stimulate the economy and invest the economic growth and to improve the transparency of government spending. At the same time, the government would provide around $787 billion financial support for the tax cuts, funding for unemployment benefits and funding for grants and loans (Recovery.gov, 2009). The government requires the usages of Recovery funds need to be reported every year to maintain its transparency. The government would also provide financial support to the local school districts. All these actions would help the country’s economy to leave the negative influence from financial crisis. However, the strategies which focuses on the government spending and taxes cut are still be discussed by the economic scholars because the effect of them are hard to be observed and examined(Wilson, 2012). Monetary Policies in Action One of the most significant monetary policies is that the Federal Reserve to support the economy is that usage of quantitative easing. It is the approach that the central bank uses its printing machines to make more notes to buy the assets (Reddy, 2010). This way could effectively decline the notes’ yield and the interest rates of the debt market. This strategy could help the homeowners to refinance their loans because the borrowing costs have been reduced. The investors also are guided into the share markets and bond markets by the market to increase the value of these securities (Reddy, 2010). It could help the US exporters because it weakens the US dollar. The whole process could push the asset prices and inflation expectations, reduce the exchange rate and real interest rates. From 2008 to 2010, the Federal Reserve has bought about $1.7 trillion of Treasury and asset-backed securities to push the economy away from the recession. The economists have predicted that this acti on could reduce 0.5% of the long term Treasury yields and also the rates in the private credit markets. It also helps the asset market, especially the real estate market to increase the prices. This activity could have the possibility to build up another round of the financial bubble because of the higher yields in riskier assets. The quantitative easing could effectively reduce the value of the US dollar and start the currency war. However, it increases the risks of pushing up the prices of commodities and increasing the inflations. The effects and risks of this policy are still the controversial topics. Have the Fiscal Policies Worked? The Fiscal Policy as ARRA actually helps the economy recovery for months. With the implementation of this act, the economy performance was significantly influenced. The real GDP showed the stable growth from the autumn of 2009. The private payroll employment also grew in about 2.2 million from 2010 to 2011(Council of Economic Advisers, 2011). Some measures have the fiscal stimulus has the effect on the increasing level of GDP from 2011. The strong growth of GDP has begun from the third quarter of 2009 and remained the good trend for the economy in the following months. The result is similar with other results from different analysts. Until 2011, the estimation from CEA showed the employment has been increased between 2.2 to 4.2 million (Council of Economic Advisers, 2011). In 2008 and 2009, the employment market has suffered the serious decline because of the impact from the recession. The fiscal policy of ARRA has raised the concerns of the Federal Government into the job market. Fr om the first quarter of 2011, the payroll employment has kept the steady increase in the following months. This result was the significant increase to help more people to work and increase their income. The Federal government has effectively cut its spending and tax in the amount of $697 billion which has followed the estimation of the act. The huge amount of the tax cuts would still continue in the next year plans. The individual tax cuts and the state fiscal relief which occupied the large proportion in the government spending have been paid more attention to deal with. The public investment spending on infrastructure and clean energy have been increased from only $7 billion in 2009 to $182 billion in 2011. It is because this act aims to develop the long-term strategies for the economy. The demands of improving infrastructure and clean energy could effectively increase the competitiveness for the country’s future economic development. These results have been compared with t he other results from different models (Council of Economic Advisers, 2011). There were no significant differences among them. Additionally, the study from Moody’s Analytics model also supported that the current fiscal policies have contributed a lot in to the increase of GDP, jobs and inflation (Blinder Zandi, 2010). After examining the results in different scenario, the study showed that the financial stimulus played an important role in the economic performance. Have the Monetary Policies Worked? The Monetary Policy actually failed to stimulate the economy. First of all, after many rounds of quantitative easing activities, the economy still remains weak. The national economy is in the low-growth environment with the poor GDP performance. The GDP in 2010 was just 2.9% which was the result with both contributions from fiscal policies and monetary policies. Meanwhile, the performance in employment market was also bad with the high unemployment rate of 9.2%. The financial support with more than $2.1 million in the job market actually worked nothing in theses months. All these bad performance have added more pressure to the Federal Reserve. Even though the value of US dollar has been decreased in the global market, the export market could not contribute sufficiently to support the economy. US government was also blamed to control its exchange rate in the global exchange market. On the other hand, the monetary policy has stimulated the creation of the new asset bubble. The impact f or the huge amount of notes in the financial system has shown in the economic performance. The inflation faced the huge challenge in the increasing prices of commodities. The SP has increased twice than last year at 8%. Residents have to face the increase in the commodity. However, the government believed this inflation was still in control and with few risks. The IPO has become the next bubble in the financial market which was the result of commodity boom and asset bubble (Groth Randazzo, 2011). This monetary policy has driven the US Federal Government into one wired situation with the mix of stagnant wages, high unemployment, high inflation and the asset bubble. The government believed that there were no threats from the inflation and asset bubbles. However, the capacity for the government to identify the potential risks and the effect of the current policy were still doubted by the economists. The government policy influenced the indicators for government to adjust its policies has become one of the paradox in the decision making process. All these results could show the failure of quantitative easing policy. Conclusion Currently, US Federal Government has implemented several fiscal and monetary policies to help the economy recover from the chaos of global financial crisis. With the combination of government spending cuts, tax cuts and quantitative easing, the US economy has shown increasing trend. With the comparison from different studies, the fiscal policies have successfully improved the performance of the economy. The government should continue the sustainability of economic development and maintain the concentration into the employment market. On the other hand, the monetary policy as quantitative easing did not show the significant effect on the economy. The increasing inflation and the potential new asset bubbles have brought more challenges to the Federal Government. In this aspect, the government must pay more attention into these two areas to avoid increasing likelihood for the other crisis. The government must adjust both monetary and fiscal policies to achieve the goal. References Bernanke, B, S. (2009). Four Questions about the Financial Crisis. Retrieved from http://www.federalreserve.gov/newsevents/speech/bernanke20090414a.html Blinder,A, S., Zandi, M. (2010). How the Great Recession Was Brought to an End. Retrieved from http://www.princeton.edu/blinder/End-of-Great-Recession.pdf Council of Economic Advisers. (2011). The Economic Impact of The American Recovery and Reinvestment Act of 2009. Retrieved from http://www.whitehouse.gov/sites/default/files/cea_7th_arra_report.pdf Groth, J., Randazzo, A. (2011). The Failure of Quantitative Easing. Retrieved from http://reason.com/archives/2011/07/15/the-failure-of-quantitative-eaRecovery.gov. (2009). The Recovery Act. Retrieved from http://www.recovery.gov/About/Pages/The_Act.aspx Reddy, S. (2010). How It Works; When It Doesn’t Retrieved from http://online.wsj.com/article/SB10001424052748704506404575592722702012904.html Thomas, B., Hennessey,K., Holtz-Eakin, D. (2011). What Caused the Financial Crisis? Retrieved from http://online.wsj.com/article/SB10001424052748704698004576104500524998280.html Weisberg, J. (2010). What Caused the Economic Crisis. Retrieved from http://www.slate.com/articles/news_and_politics/the_big_idea/2010/01/what_caused_the_economic_crisis.html Wilson, D, J. (2012). Government Spending: An Economic Boost? Retrieved from http://www.frbsf.org/publications/economics/letter/2012/el2012-04.html

My Educational Philosophy :: Philosophy of Education Teaching Essays

My Educational Philosophy Education is diverse. Due to the various natures of knowledge and students, it is difficult to place my educational philosophy in one category. Each student is unique; curriculums vary depending on many factors. I feel that many educational philosophies are beneficial to education. The nature of students reflects many things including heredity, home life, and society as a whole. Through my experiences working with Americorps/Energy Express, I learned children from lower income families tend to lose three months of education during the summer break. The students never regain these losses. While lower income children lose learning, children from higher income families gain a month of learning. This demonstrates the importance of home life in the nature and education of students. When teaching, one must always consider the aspects that may affect the students’ nature along with the nature of knowledge. Knowledge is both relative and absolute. Literature is an example of relative knowledge. Interpretation of books or poetry depend on the person reading the material, the place where the literature is read, and the time period in which the person is living. Science and mathematics are absolute. One plus one equals two regardless of the time, place, or person. Acquiring knowledge, whether absolute or relative, is the purpose of education. Public education is important to improving society and the future. Like Plato, I feel education gives people the ability to think critically instead of being blindly led by others. As a future teacher, I am idealistic in that I hope to encourage students to challenge themselves, I also hope to encourage students to continue learning throughout life, and prepare for college. To accomplish these goals, I will incorporate pragmatic methods like hands on activities through laboratory experiments and problem solving into my teaching. This also falls under experimentalism. The Socratic method of small group discussions, lecturing, and questioning will be used to help students acquire knowledge. Using many methods will help all students to understand the material presented. Discipline will play an important role in reaching my goals for the students. I plan to use pragmatic methods also in establishing rules.

Recruitment and selection with Job description and job specifications Essay

I m sending you a mail about your job and what your role is in the office. On the Monday morning you will be starting your job as soon as you come in. so I thought of giving you the required information so you would feel more comfortable. At first I would like u to know about the Recruitment and Selection is when you start advertising for the job. The advertisement is important to the firm because they must be carefully formatted so they attract the applicant in the first sight. The information should be clearly stated or the time will be wasted on selecting the right applicant. When we are selecting the staff we ask their CV and compare it job specification. Next we have the Training we should teach the staff the right rules and the firm objectives and its working products and the rules and regulations. They should be friendly and should be shown all around the working area Remuneration this is the method we pay our staffs. We pay them in hourly bases most of them work less than nine hours a day we pay you on the start on of every month. Appraisal is for motivating the staffs so they get more interested and work more hard. Dismissal is when you fire some one from the job either when they are not working properly or when we don’t have the job any more. The kinetic needs an engineer in the production department. For the best out come we should give the correct details for the advertisement about the job description and job specification. So we don’t spend a lot of time on selecting the applicant. The share holders will not have any problems but the directors of the company will have problems because they need to spend more money than they expected for advertising for the new staff, have to replace some one in that place and will have to face more consequences. The other staffs will have problems too because they will have to do over time, some may have to take care of both their jobs mainly the customers will have the problem in buying because they will not be satisfied because of the quality of the product the company might face a lose for a period of time until they get a new engineer. Hear are the descriptions of job description and the job specification. The job specification and the job description will help the candidates to know what they need and what type of work they need to do. Further information is in the next page. JOB DESCRIPTION The purpose of the job description is to inform the candidate about the type of job they will be doing and it will include 1 Job title. 2 Location. 3 Hours of work. 4 Wages. 5 Duties. 6 Other responsibilities. 7 Your position. 8 Tenure. JOB SPECIFICATION The purpose of job specification is to inform the candidate about the qualities needed in a successful candidate it will include 1 Qualifications 2 Previous work experience 3 Skills 4 Special interests 5 Member ship of professional body 6 Personality 7 Temperament This is the job specification and the job description of the current job advert JOB DESCRIPTION * Job title – Engineer Production department * Location – Surrey * Hours of work – 5 to 6 hours per day * Wages – 24,000 to 26,000 * Duties – To choose the correct product for the production, to check the capability and the capacity of the machineries, should be able to activate and deactivate the machineries and should also know to maintain them and to function with out any problem in the production * Other responsibilities – Must be more responsible at your work * Your position – * Tenure – Permanent only JOB SPECIFICATION * Qualifications – Post graduate in Mechanical Engineering, have a driving licenses * Previous work experience – experience with or within the mechanical power transmission industry * Skills – CAD, comprehensive pc literacy * Special interests – * Personality – must be focused in solving problem, desire to Temperament – These are the information about the methods of recruitment, which tells the advantages and the disadvantages of the types of recruiting methods.

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