It is obvious to Americans that our economy is in terrible shape, but what many people don't understand is how it got this way. Although people have many different opinions as to where the economic crisis originated, experts say that the problem traces back to the housing bubble that came about earlier this decade. According to a recent study by Brookings Institution, "Housing prices jumped at a rate above 6 percent in 1999 and increased rapidly and steadily as the decade turned...After the mid-1990s, real house prices went on a sustained surge through 2005, making residential real estate not only a great investment, but it was also widely perceived as a very safe investment". Along with the housing trends, experts also say that the effects of the September 11th terrorist attacks are another leading cause of our current situation. Meanwhile, global investors were looking towards the United States for ways to make even more money, and consequently, they put their cash into (what they thought would be) "the 'safest' economy in the world". Now that our country is waist-deep in loans and debts, people are beginning to panic. Econmist Peter Rodriquez calls it a "death spiral of prices" that has spread across our country "like a virus", causing our markets to plummet. CNN's Ali Velshi claims "It was a perfect storm...It was a lack of regulation, it was greed and creativity in the financial industry, and it was an American dream that got off track."
-Hannah
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