What were the causes of the Great Recession?

What were the main causes of the Great Recession?

The Great Recession, which began in 2007, was primarily caused by the housing market collapse, risky mortgage practices, and financial institution failures.

How did subprime mortgages contribute to the recession?

Subprime mortgages were loans given to borrowers with poor credit histories. When many of these borrowers defaulted, it triggered a financial crisis.

What role did the banks play in the recession?

Banks engaged in high-risk lending and investment practices, which led to significant losses when the housing market collapsed.

Were there any government policies that contributed to the recession?

Yes, policies promoting home ownership and deregulation of financial markets allowed risky lending practices to flourish.

What were the long-term effects of the Great Recession?

The long-term effects included increased unemployment, a slow recovery in housing markets, and changes in financial regulations.