The crisis of the dollar in 2007
Sábado, Marzo 15th, 2008
The dollar in 2007 has fallen, even if the situation seemed to be something temporary, after some days the economic operators and analysts realised that the crisis would continue some more time.
2007 was a very bad year for the American economy, projections done for the beginning year were around 1.5% growing rate. This will make the Federal Reserve of the United States to take the interest rate from the actual 4.50% to 3.50% for the second term of 2008. And in case recession risk continues we will se the Fed reducing the rates to 2%.
We also have to consider that during 2007 the dollar suffered an unexpected shock, as the mortgage crisis knocked the financial system and brought different kinds of problems.
The problem is that the American economy spends in advance and this concerns to all its citizens. Noone has the money in cash to buy properties, Americans have credits for terms that some times are extended, and they live with a rhytm of expenditure that is not possible to control.
The problem appeared during 2007 when interest rates increased because of the crisis, thousands of Americans could not confront debts and this make a collapse at the financial system.
If something was missed by the dollar in 2007 to stop suffering, there was a big shock because of the high risk mortgage crisis where thousands of investors saw the end of one of the bases of the American economic system.
The dollar in 2007 has fallen, even if the situation seemed to be something temporary, after some days the economic operators and analysts realised that the crisis would continue some more time.
2007 was a very bad year for the American economy, projections done for the beginning year were around 1.5% growing rate. This will make the Federal Reserve of the United States to take the interest rate from the actual 4.50% to 3.50% for the second term of 2008. And in case recession risk continues we will se the Fed reducing the rates to 2%.
We also have to consider that during 2007 the dollar suffered an unexpected shock, as the mortgage crisis knocked the financial system and brought different kinds of problems.
The problem is that the American economy spends in advance and this concerns to all its citizens. Noone has the money in cash to buy properties, Americans have credits for terms that some times are extended, and they live with a rhytm of expenditure that is not possible to control.
The problem appeared during 2007 when interest rates increased because of the crisis, thousands of Americans could not confront debts and this make a collapse at the financial system.
If something was missed by the dollar in 2007 to stop suffering, there was a big shock because of the high risk mortgage crisis where thousands of investors saw the end of one of the bases of the American economic system.