Question

Regarding America's 2009 economic crisis, New York Times Op-Ed Columnist Frank Rich writes in a January 9, 2010 editorial that ultimately "Wall Street gamed and inflated the housing bubble, made out like bandits, and then left millions of households in ruin" and goes on to say that "bailed-out banks are [now] reporting record profits and bonuses. The contrary voices of Americans who have lost pay, jobs, homes and savings are either patronized or drowned out entirely by a political system where the banking lobby rules in both parties and the revolving door between finance and government never stops spinning."

Write a carefully reasoned essay in which you defend, challenge, or qualify Rich's claim regarding politics, economics, and the American citizen . Support your argument with specific references to your reading, observation, or experience.

Answer 1

One of the causes for America's 2009 economic crisis was the invention of subprime mortgages, for 'second class' clients, who previously did not have access to credits, but the innovation of securitizing these mortgages arose, clients paid only interest the first years, making the quotas lower, but the interest rates were variable and then they were increasing and the salaries were being eaten by those payments, the central bank allowed the rules of the game to be changed, because of the crisis that was coming, this left thousands of Americans unemployed and without homes. In all this the government did not intervene favorably, on the contrary, after a while it helped the financial system to recover, but no citizen could do it.