The Boom and Bust of the Housing Bubble Analytical Essay

This paper discusses the economic conditions of the U.S. in 2010 starting with the boom and bust of the housing bubble.
# 146554 | 4,370 words | 20 sources | MLA | 2010 | US

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In this article, the writer presents an analysis of the short run prospects of the U.S. economy, focusing on some major shocks such as the burst of the housing bubble, the actions taken by the Federal Reserve through monetary policies, and fiscal policies the government implemented with the intentions of improving the economy. For each shock the writer details the impact of the shock on key macroeconomic variables such as GDP growth, interest rates, unemployment, inflation, imports and exports. Relevant graphs are included in this paper.

Monetary Policy
Fiscal Policy
Synthesis and Analysis

From the Paper:

"The housing bubble in the U.S occurred in 2002 until early 2007; average housing prices increased dramatically, beyond their actual values. Yet people still continued to purchase houses; the rapid growth of prices convinced many buyers (especially those without real estate experience) that they can sell their houses for more later on and pocket the differences. Eventually, the bubble bursts because the market ends up with many sellers and too few buyers; then the prices were driven down, and many participants are left with loss rather than profit. As illustrated in Fig. 1, the prices began to increase even before 2001, but grew even more rapid after 2002, and it burst in early 2008 when interest rates rose, then the prices dropped. "

Sample of Sources Used:


Cite this Analytical Essay:

APA Format

The Boom and Bust of the Housing Bubble (2011, January 04) Retrieved February 27, 2020, from

MLA Format

"The Boom and Bust of the Housing Bubble" 04 January 2011. Web. 27 February. 2020. <>