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2008 Economic Meltdown

Why is the economy in trouble? People are not buying houses because they are not sure of the market price for any given house and there is an over supply at this time. People are not buying automobiles because they are reacting to the rapid run up in gasoline prices and want more fuel efficient choices. They are not buying much of anything else because they are fearful of losing their jobs and they are maxed out on debt currently.

The most important problem is that the entire country has been running on borrowed money and there is too little savings to allow a rapid recovery from the three problems above.

What caused the 2008 Economic Meltdown?

The primary cause of the 2008 Economic Meltdown was too much money in the US economy due too deficit spending by the Federal Government.

Lesson learned:

Unregulated Capitalism does not work. It is unstable and the benefits are not shared among everyone in a reasonable manner.

Q. What should individuals do to prevent another melt down?

A. Individuals should start living on 90% of their income. If everyone starting saving for a rainy day, they would be in a better position to prevent adverse effects of economic down turns.

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