Economic Impact: White Paper
-Brennan Legal Councel Group, August 2020
2020 is unprecedented in US economic history, with government mandated closures and many stress factors on the economy. As a college history major, I pondered: what can history tell us about the economic factors which impacted the downfall and the recovery of the Great Depression, Inflation of the 1970’s and 2008 Great Recession? How will these factors correlate to the impact of Covid-19 on commercial real estate?
Due to travel restrictions and business closures and summer course cancellations, I was able to assemble a capable group of college interns. I decided to put them to the task of researching and compiling their research into a White Paper, which you now hold.
This White Paper is a compilation of historical information and economic theories. The approach is uniquely ours, but the information is derived from others, to whom we have given credit, please forgive any errors on our part in giving credit where credit is deserved. While we cannot predict the future, the impact of the closures on commercial real estate, we can watch the historical economic indicators and anticipate recovery and posture ourselves to mitigate damages and to take advantage of opportunities.
You may use this information. With one provision, that you give the credit to original source and the authors: Brennan Legal Counsel Group, PLLC, Joseph Kajon, Tatyanna Kish and Bobby Drake.
Meet The Team
SHAUNA S. BRENNAN, ESQ.
Shauna S. Brennan is founder and principal of Brennan General Counsel Group, PLLC. Ms. Brennan has over 33 years’ experience providing legal advice in real estate and commercial transactions. She earned her J.D. degree from Notre Dame Law School, where she was a member of Notre Dame Law Review. Ms. Brennan is admitted to practice in Washington, Nevada, Maryland, and the District of Columbia. An entrepreneur, Shauna also owns a real estate company in Seattle, WA, and operates Smart Seller, offering education and investment opportunities in commercial real estate.
Shauna supports professional development for women through her participation in Commercial Real Estate Women of Las Vegas, where she is the Founder and Past President, and NAWBO Southern Nevada, where she serves as 2020 Board Member and Chair of the Professional Development and Leadership Committee.
Shauna is able to be the change she wants to see in the world through community service on the Community Advisory Board for the Salvation Army of Southern Nevada, as a member of the SEEDS (Saving, Empowering, Educating and Restoring DreamS for survivors of sex trafficking and acute trauma) of Hope Committee, on the Board of Living Grace Homes, maternity homes for homeless girls, and on the Board for Youth Leadership Authority, dedicated to providing character development and opportunities to at-risk community youth. Shauna has two grown daughters and 4 grandchildren. 6
More about Brennan Legal Counsel Group’s 2020 Summer Interns
Mr. Kajon lives in South Orange, New Jersey, he is entering his 2nd year at Seton Hall University, he is currently studying for a Bachelor's of Science in Mathematics’. Mr. Kajon, is on the Dean’s List, he has also received several awards, such as the Robert F. Lucus Outstanding Lieutenant Governor’s award, and the Discipleship Award from the Archdiocese Newark. Mr. Kajon, is a pillar to his community, he is currently a Team Lead at the Buccino Leadership Institute. Some of his hobbies include playing soccer, listening to all types of music and podcasts, and learning about obscure history and facts!
Ms. Kish lives in Philadelphia Pennsylvania, she is entering her 2nd year at Temple University, she is currently studying for a Bachelor's in Business Administration. Ms. Kish has filled her time volunteer services at Our Lady of Perpetual Help, Queenship of Mary Parish, goLEAD program in addition to filming and photographing High School Football and Lacrosse games. Some of her hobbies include videography/photography, hiking, cooking, and fashion.
Mr. Drake. Lives in Las Vegas, Nevada, he is entering his first year at the University of California Santa Barbara, he is currently studying for a Bachelor's in Economics. Some of Mr. Drakes hobbies include, Basketball, Traveling, Studying Politics. Mr. Drake’s long-term goal, is becoming the Governor of Nevada.
THE GREAT DEPRESSION
I. The Great Depression Timeline 1920-1929
The historical period known as the Great Depression spanned from 1929 to 1941. In retrospect several factors attributed to the sever economic downturn, culminating in the stock market crash of 1929. Extreme overconfidence contributed to inflation of values of real estate and equities at the stock market, such that the public sentiment was that the economy was “too big to fail.” The public mentality to do what everyone else was doing, known as the “crowd theory” also contributed to investing at inflated prices. Another disparity indicator of the pending economic failure was the struggling agricultural industry, where salaries were a fraction of the salaries in other sectors. These factors indicated trouble on the horizon.
(1) EXTREME OVER-CONFIDENCE (INDICATOR) in all aspects of the U.S Market including stock prices and housing resulted in overpriced stock and property. It extended over a 9-year period where the market grew by about 20% each year. The market (overheated by massive growth for almost a decade) was destined to crash eventually and almost nobody expected the magnitude of the crash to be as powerful as it was because very few people were aware of how overpriced stocks and real estate were at the time.
(2) CROWD THEORY INDICATOR The extreme confidence led people to leave their assets in the stock market for a long period of time and everyone ended up pulling out of the stock market at the same time as well as everybody trying to liquidate their assets at the same time. Over the course of 6 days, about 44,554,650 million shares were traded, and the Dow Jones fell by 13% on Black Monday and 12% the next day on Black Tuesday. In 6 days, the New York Stock Exchange lost 14 billion dollars which is equivalent to 206 billion dollars in 2019.
The overpricing of stock and property led to overconfidence by banks and consumers and they were not worried about debt at all.
Once the market dipped, people became skittish and began running the banks to liquidate assets that the bank had lost in the stock market.
Due to the over-confidence in the market by everybody including banks and consumers, banks would lend consumers large amounts of money while the consumer only had to put 10% down on what they were being loaned. The consumer would then put every dime in the stock market and when it crashed, the money had virtually disappeared. When people began making runs on the bank to liquidate their assets, they were unaware that the banks had loaned out their money and most of the money people had in their accounts was lost in the stock market crash even if they did not put it into the stock market.
II. The Great Depression Timeline August 1929
(1) Federal Reserve Intervention (INDICATOR) had raised the interest rate from 5% to 6% to slow the incredible growth of the stock market. They raised the interest rates just weeks before the crash. This had detrimental effects to investor’s confidence in the stock market. The government getting involved indicates economic downturn is ahead. These actions by the Federal Reserve Bank of New York had devastating effects on the economic growth of the country.
(2) Struggling Agriculture (INDICATOR) Prior to the stock market crash, there was an ongoing recession in the agricultural industry in the United States where farmers were unable to turn a profit or keep their businesses functioning. This had a negative effect on the atmosphere of the American business world. The end of World War I had hit the agricultural industry the hardest and they never full recovered, the stock market crash sent produce prices to the lowest they had ever been, which had created unrest among farmers across the United States.
The financial atmosphere in the weeks prior to the crash started to reduce investor confidence in every aspect of the market. Farms were failing which has negative effects on the market, and the government sharply increased interest rates resulting in a sharp decrease of investor confidence in the market which contributed heavily to the crowds flooding the stock market to get rid of their shares.
The federal Reserve raising the interest rate made many investors skittish prior to the crash and it demonstrated that the government did not like what was occurring in the stock market or the agricultural industry, so when the market crashed, people started excessively trading and selling their shares and created a snowball effect, which compounded the size of the crowds rushing the trading floor.
The Federal Reserve Bank intervening by raising the interest rates from 5% to 6% caused massive damage that they were not yet aware of at the time. This not only harmed the stock markets ability to grow and recover in a timely manner, it also stunted the agricultural industries ability to turn a profit, in a time where they were already struggling heavily. When the government intervenes in economic affairs it is typically a sign of recession if the changes are made to late. Had the Federal Reserve raised interest rates earlier the crash might not have been as devastating as it was. The timing was poor and that resulted in not only the stock markets recession being prolonged, but the agricultural industries recession being worsened as well.
III. The Great Depression Timeline 1932
Pro-Economic Policies (INDICATOR) are strong signs that the market’s free-fall will be coming to a halt shortly and that economic recovery is not too far away. On January 22nd, 1932, the Reconstruction Finance Corporation was created to lend money to failing businesses who were struggling to rise above the stock market crash. They issued around 9.5 Billion Dollars (568.7 Billion Dollars as of 2019) between 1932 and 1941 to banks, local governments, and railroad companies. In April of 1932 the Federal Reserve opened market transactions increasing supply by 1 Billion Dollars ( 32.8 Billion Dollars as of 2019) which gave them ability to regulate the amount of cash in reserves, thus allowing banks to loan out more money to pull businesses out of the recession. By July 8th, 1932, the Dow Jones Industrial Index had bottomed out at 41.22, over the course of 3 years the Dow Jones Industrial Index had lost almost 90% of its value prior to the crash. This was the lowest point the stock market would reach, although this was the lowest point, there was nowhere else to go but up. The CCC (Civilian Conservation Corps) employed 300,000 people which had a positive effect on the morale of the American people, but did not have drastic economic effect because they were payed a barely living wage of 30 dollars a month (560 dollars as of 2019) which meant that most of the money wasn’t flowing into the stock market, they had no excess cash to invest. The CCC was a red herring (False Indicator) because it did not have the effect most people believe it did.
The government’s creation of pro-economic policies helped alleviate the damage the stock market crash would have on the American people. These policies acted as a stimulus, flooding billions of dollars into the economy allowing businesses to begin the recovery process towards the beginning of 1933. The crash could have lasted much longer without the assistance of the federal government.
The government’s intervention into the stock market helped the stock market exit a period of massive recession and ushered in a period of slow but steady economic growth. Although it would take nearly 9 years for the market to fully recover, the worst was over by the beginning of 1933.
History has proven that pro-economic policies created by the federal government help jumpstart the economy and, in some cases, pull the economy out of a recession. The policies instituted in 1932 immediately influenced the American economy. While the stock market was still falling, the fall had been greatly slowed and in less than 6 months the economy had finally hit rock bottom and economic growth had started to take place in all corners of the market. Although it was a slow process, the government intervention had proven effective for the first time in U.S history.
IV. The Great Depression Timeline 1939 - 1941
War (INDICATOR) has an incredibly positive effect on the economy, it usually supplies millions of people with jobs and greatly expands the industrial sector of a country. War indicates that an economic boom is around the corner. On September 1st, 1939, Adolf Hitler ordered the invasion of Poland, sparking the beginning of World War II. The United States began selling arms to France and Britain, in turn the economy grew 8% in one year and unemployment fell to 17.2%. By June of 1940, Hitler had conquered France and Blitzkrieg (German Bombs Dropping) was taking place all over Britain. The United States began selling even more arms to Britain, resulting in the economy growing another 8.8% and unemployment falling once again to 14.6%. On December 7th, 1941, the Japanese bombing of Pearl Harbor brought the United States into the war against Hitler and the Imperials. The declaration of war created millions of jobs and the economy grew 17.7% while unemployment was reduced to just 9.9%.
The actions taken by Adolf Hitler and the Japanese between 1939-1941 provided the United States with an economic opportunity to sell and supply arms to the ally countries (France and Britain), this was short lived however due to the bombing of Pearl Harbor by the Japanese in 1941. When the United States entered the war, the economy grew massively and became much stronger.
World War II proved to be very profitable for the United States in financial terms. Allied countries being brought into a war gave the United States a massive economic opportunity by selling and transporting arms to Britain and France. When the United States finally entered the war, it had numerous positive economic effects.
War is an exceptionally reliable indicator to use when attempting to predict where the economy will lead. Throughout American history, war has led to economic prosperity either by profiting off other nations by selling arms or other supplies, or by entering a war ourselves in turn creating millions of jobs and boosting industry. War creates countless economic opportunities not only for countries but for citizens as well. Private armies, mercenaries, arms dealers, arms makers and countless other businesses all thrive during wartime. Although war is terrible in just about every other aspect, it is great for the economy.
In conclusion, initially the same “crowd theory” that contributed to inflated prices, caused the drastic “crash” when the public lost confidence, the public followed suit to sell off together. The crowd drove the prices up, then raced down, frantically selling off, after prices began to fall, a virtual snowball effect. In total, the Great Depression recovery took over ten years, in part because the US had not experienced an economic reversal of this magnitude and had not previously utilized government intervention or economic policies to stimulate the economy. The market decline halted shortly after the pro-economic policies were put into place by the government. Ultimately the manufacturing boom brought on by the war effort contributed to recovery from the Great depression.
- Pro-Economic policies put into place by the government indicate that the markets descent will be halted shortly.
- The RFC (Reconstruction Finance Corporation) and many other departments were created.
- These new policies helped lower the unemployment rate in the United States.
Graph Source: Heritage.ORG
GREAT DEPRESSION RECAP
- Negative Impact Factors
- Extreme Overconfidence
- Crowd Theory
- Struggling Agricultural Industry
- Key Recovery Indicators o Pro Economic Policies
- Federal Reserve Intervention
INFLATION OF 1970’S
(GREAT INFLATION: 1965 – MID 1980S)
I. The Great Inflation Timeline 1955 – 1975
The Great Inflation took place from 1965-1980s, it was a period known as stagflation. The economic climate at the beginning of the time period consisted of inflation plus stagnant growth within the economy. The initial negative impact was the U.S. government increasing spending for the Vietnam War and expansion of Social Security. Then, three oil shocks and poor leadership continued to be a negative impact on the United States’ economy. The poor leadership was driven by politics as well as consisted of awful trade, overconfidence, breakdown of the Bretton Woods System, high unemployment, and artificial restrictive monetary policies. What lied on the horizon was the Federal Reserve increasing interest rates to slow money growth and stop the growing inflation. Former Chairman of the Federal Reserve, Paul Volcker, said “once an independent central bank does not simply tolerate a low level of inflation as consistent with 'stability,' but invokes inflation as a policy, it becomes very difficult to eliminate". That quote specifically emphasizes how important inflation containment is. The structural changes led to the period known as the “Great Moderation” which was filled with stable and low inflation in the late 1980s.
The increased spending for the Vietnam war and the previous prosperity of the economy enabled pressure on prices. (Indicator) History and economic theory indicate that wars typically have an inflationary impact. The war’s inflationary impact depends on the economy’s state, the war time’s economic policy, and the manner it is financed. The costs (full) of all equipment, materials, and forces utilized in the war summed up to over $140 billion. The incremental costs of fighting this war were above the normal costs of using baseline forces in a peaceful time were over $110 billion. The Vietnam war placed accelerating demand on resources and made extra claims on such resources throughout its tenure.
In 1965-1967, it was guns and butter.
Economic policymakers failed to enact corrective policies.
The consequences of the Vietnam war were among the significant factors in establishing and maintaining the economic difficulties that the United States had faced during the 1970s. The escalations of wartime increased demand for resources, the timing of the impact lent support to the idea that the war stimulated the inflation, and a stimulus to aggregate demand.
Inflation continued to accelerate by the late 1960s and set the foundation for the inflationary spiral of the 1970s.
Certain aspects lead to a larger inflationary impact such as if the economy is close to full employment (ceteris paribus) or if the war is financed by the Federal Reserve lending directly to the Treasury or by printing money.
However, its inflationary impact will not be checked if the government does not increase taxes or not decrease non-military spending to pay for the war.
The (GNP) American gross national product, the measure of all services and goods by a country’s citizens (regardless of location), had increased from $200,000 million in 1940 to over $500,000 million in 1960 to around a trillion dollars by 1970. Between 1945 and 1970, the American standard of living had doubled. “The greatest prosperity the world has ever known” was shortly lived for 25 years post World War II. Economic trouble emerged in the mid to late 1960s. The inflation could have been mitigated by monetary policy, but policymakers failed to do so.
II. The Great Inflation Timeline 1969-1971
Poor Trade (Indicator)
High Unemployment (Indicator)
Restrictive Monetary Policy:
Freezing Wages and Prices (Indicator)
De-valuing Currency/Breakdown of the Bretton Woods System (Indicator)
Between the years of 1968-1970, the percentage of unemployment rose by 33%. The consumer price index went up by 11%. Real wages began to become stagnate at the same time.
Nixon, a Keynesian, inherited a recession from Lyndon Johnson (who spent a lot of money on the Great Society and Vietnam War). Despite some protests from Congress, Nixon increased social welfare spending (big expansion of Social Security) and continued funding the war Nixon’s main concern was going back into another recession, not inflation. Nixon pressured the FED to do low-interest rates during his re-election time period and wanted the economy to boom. Nixon imposed wage and price controls for a 90-day period in 1971.
Expansion of at home social programs without commensurate tax increased aided the drive of inflation (the price of services and goods)
Arthur Burns was hired as Chairman of the Federal Reserve, and William McChesney Martin was fired.
However, later on the wage and price controls would fuel the double-digit inflation of the 1970s. Businesses and individuals tried to recover from the lost ground once they were recovered.
Nixon decided to take the dollar off the gold standard to devalue the currency to help with inflation and boost American exports. In short term, it helped Nixon get reelected, but it did not have positive long-term effects.
The administration under Nixon moved to cut government spending.
Inflation was still in the low single digits, but after the election year the high inflation price would be paid. The nation eventually grew an abundance of unemployment and inflation.
The Fed is specifically dedicated to creating money policies that stimulate growth without excessive inflation. There is a common conspiracy that Burns was ordered and pressured by Nixon in some of his decision making. Although Chairman Burns could have been pressured, it is still believed that he still did what he thought was best for the economy. President Nixon desired cheap money that had low-interest rates that would promote growth.
In short term, it would make the economy appear strong as voters were casting such ballots. In long term, the inflation would continue.
This was an 11-month recession from 1969-1970. Typically, when wages fall so do the prices and when wages increase so do the prices. However, that did not occur in the stagflation of the 1970s.
Not only did Americans have less purchasing power, but the increasingly expensive American exports were a disadvantage in the international market. In 1971, the United States experienced a poor international trade since 1893.
In several ways, the modern commercial real estate market came into being during the early 1970s. Commercial real estate markets are cyclical.
III. The Great Inflation Timeline 1973-1975
High Oil Prices (Indicator)
Increased High Unemployment (Indicator)
In the Yom Kippur War, the United States supported Israel after a surprise attack by Syria and Egypt. The Middle East, an oil rich area, was unhappy with United States for de-valuing the dollar because it was the currency that was used to purchase the oil. The (OPEC) Organization of the Petroleum Exporting Countries decided to announce an embargo, led by Saudi Arabia, against the United States and Israel’s European allies.
The effects of the embargo were immediate. The price of oil skyrocketed to $11.65 per barrel which was an increase of 387%. United States consumed one third of the world’s oil, there were mile long lines that formed outside of gas stations.
The prices quadrupled, which forced people to restrict their spending in other areas to be able to afford their oil.
There was even and odd rationing of license plates that designated what days people could buy gas on.
A multitude of states that mandated the gasoline rationing were New York, California, Texas, Pennsylvania, and New Jersey.
Daily life was dependent on cheaper gas prices. The price of oil still remained 33% even higher after the oil embargo ended in 1974.
Burns failed to appropriately treat the oil shocks as a recession and did not give enough stimulus. Those errors resulted in high inflation.
The 1973 stock market crash globally concluded in a bear market for two years that saw Dow Jones Industrial Average lose 45% of its value.
For the time period being covered, the peak of the high inflation was 1974-1975. The GDP declined 3.4% while unemployment increased from 4.8% to around 9%.
The disruptions to global oil supplies led to soaring prices and gasoline shortages in the United States. Inflation rose to almost 12% the following year while the core inflation increasing only slightly less as higher oil prices fed through to prices of non-energy
IV. The Great Inflation Timeline 1979-1980
Raised interest rates (Indicator)
Slowed money supply growth (Indicator)
Energy crisis (Indicator) – second oil shock
Overconfidence (Indicator) fiscal policy
Monetary policymakers were extremely optimistic about how “hot” the economy could run without causing inflation pressures. Monetary policymakers responded too slowly when inflation began to continue to rise. Milton Friedman warned that the overconfidence would have a poor effect.
In 1979, Paul Volcker took over as Chairman of the Federal Reserve. He announced in October of 1979 that a dramatic break would occur in the way monetary policy would conduct business. His new practice involved raising interest rates to be high (tight money) to slow the economy in the fight against inflation.
The Iranian Revolution triggered another oil shock. The shock sent the core inflation and inflation into double digits. There were double dipping recessions that follow the shock that returned inflation back to more tolerable levels. In 1982, that recession was the most severe post-WWII recession up to that time. The severity of the recession was reflective of a new anti-inflation approach to monetary policy led by Volcker.
Supply and energy prices were put at risk causing a confidence crisis on top of inflation. The Federal Reserve raised interest rates and slowed money supply growth. The levels of unemployment rose, and inflation reached 11.1%.
OPEC’s market share fell drastically. Utility companies moved towards other alternative energy sources.
In twelve months, the crude oil prices almost doubled to about $40 per barrel
This era accompanied by multi-lateral currency market intervention which reversed dollar appreciation, a strong expansion in global trade, and broadening and deepening of the financial markets worldwide.
Smaller cars were developed during this period for fuel efficiency purposes.
(FOMC) Federal Open Market was reluctant to raise target rates of interest too quickly because of prior monetary policy (which resulted in a different range of consumer services and products as well as higher prices for energy
Consumers were encouraged to limit traveling and conserve energy usage.
All contributed to the downward trend in inflation rates through the subsequent decade and to the present. Global trade has expanded both in absolute terms and also in its importance to the U.S. economy.
The United States regulated oil prices in the early 1979. Refiners that were ordered by the regulators to restrict the gasoline supply to build inventory in the early days. The minimal supply contributed to the high prices.
The (DOE) Department of Energy allowed only a small number of large refiners to sell crude to smaller refiners. Due to small refiners having limited capabilities for production, the ability to purchase gasoline was constrained due to the shortage.
V. The Great Inflation Timeline 1981-1982
Oil shortage/ high price (Indicator)
High unemployment (Indicator)
Tight monetary policy (Indicator) -
Raising Interest Rates
The third time in a decade that a recession was caused because of an oil crisis. The Iranian Revolution was over, but the new regime was under the control of Ayatollah Khomeini. He continued to inconsistently export oil and for lower levels while the prices were high. “This long and deep recession was caused by the regime change in Iran. The world's fourth-largest producer of oil at the time, the country overthrew it’s U.S. backed government. The "New" Iran exported oil at inconsistent intervals and at lower volumes, forcing prices higher. The U.S. government enforced a tighter monetary policy to control rampant inflation, which had been carried over from the previous two oil and energy crises. The prime rate reached 20.5% in 1981.”
The Federal Reserve’s interest rate hikes that occurred in 1980 were not enough to continue to slow the inflation properly. Paul Volcker increased the interest rates to new levels. In 1982, the rates were 21.5%. The high of a ration pulled the inflation down while taking a toll on the economy. It shrunk by 3.6% during the sixteen months of recession. Unemployment had increased over 10%.
This recession was triggered by another energy crisis while the new Iranian regime lessened its oil output and raised global oil prices. The recovery resulted in expansion of the economy that lasted the rest of the decade. President Reagan’s tax cuts, eventually the Federal Reserve lowering interest rates, and increased defense spending.
This is known as a double-dip recession.
Policymakers were aware of the Great Inflation, but it was not until 1979-82 when they pursued policies to diminish it.
This far more painful recession hurt exponentially, being the third in a decade.
Paul Volcker’s persistence paid off despite resistance. The federal funds rate was back to fall back to 9% and eventually unemployment declined to 8% in 1983. The threat of inflation had not disappeared, but it was diminished.
VI. The Great Inflation Timeline Mid 1980’s
Lowering interest rates (Indicator) Structural changes (Indicator)
The Fed lowered interest rates again in mid-1980, giving the economy a chance to rebound and ending a brief, six-month recession. Both the inflation and output were highly volatile. Stable and low inflation promoted broader stability economically.
The federal government ran persistent, large deficits in the 1980s. They had an independent policy, did not coordinate policy, and did not assist in deficit finance.
The Federal Reserve’s even-kneel policy of holding interest rates constant when the Treasury sold bonds or notes contributed to important operating changes. During this time, the Treasury auctioned off its securities and let the market price them instead forcing the Federal Reserve to support a price that the Treasury set.
By the 1980s, the public and policymakers had learned that inflation was costly. Voters elected a President committed to reducing it, and the Federal Reserve had a Chairman who changed procedures and, most importantly, remained resolute in the commitment to reduce inflation.
The Federal Reserve would face a decent amount of “inflation scares” in the 1980s, but the commitment of Volcker as well as his successors aggressively targeting the stability of prices aided that assurance that double-digit inflation of the 1970s would not return.
The Mid 1980s to 2007 was a period called the “Great Moderation”. The past experiences of years prior illustrated how central banks continually struggled with imperfect knowledge and an evolving economy. It is incredibly true that “prices are the thermostat of an economy”.
The stagflation and Great Inflation of the 1965-1980s included several negative impacts on the United States of America’s economy. The primary negative impacts were awful trade, leadership driven by politics, breakdown of the Bretton Woods System, overconfidence, artificial restrictive monetary policies, and high unemployment. The tipping point was the three oil shocks of high prices and low quantities. The oil crisis and recession especially affected the economy.
The primary recovery indicator was the Federal Reserve increasing interest rates in order to diminish overconfidence within the economy to slow money growth. The increased fund rates led to high unemployment and drove the economy into a recession. Eventually, Chairman Volcker was able to decrease interest rates, decrease unemployment, and drive the economy out of a recession to stabilize it. The Great Moderation is a period to focus and emulate due to economic stability as well as contained inflation.
OVERCONFIDENCE IN MONETARY POLICY
- High unemployment
- Optimistic policymakers
- Less purchasing power, disadvantaged American exports internationally
Data Source: U.S. Bureau of Labor Statistics
INFLATION OF 1970’S
(GREAT INFLATION: 1965 – MID 1980S)
- Negative Impact Factors
- Poor Leadership
- Energy Crisis
- Overconfidence in Monetary Policy
- Key Recovery Indicators
- Federal Reserve
GREAT RECESSION OF 2006-2010
I. The Great Recession Timeline Mid 2000’s
Leading into the Great Recession, the housing market was booming and demand for Mortgage-Backed Securities (MBS) greatly increased due to their high-yield and the thriving housing market. Banks began to lower their standards for loans for the supply of investments to meet the demand. Doing so allowed people who previously did not qualify for loans to become eligible. While this helped fulfill the demand for the investment option, these people could no longer pay their mortgages as interest rates started climbing and they defaulted on their loans. This increased supply of houses on the market caused the housing bubble to burst, setting the stage for the bankruptcies, bailouts, stimulus bills, stock market plummeting, and high unemployment rate of the Great Recession.
Subprime Mortgage Crisis - With the supply of conventional mortgages dwindling but demand increasing, mortgage lenders expanded their definition of credit-worthy, essentially granting mortgages to buyers with poor credit histories who would not have met the previous requirements. Banks invested in these high-risk loans, increasing the risky lending practices. The Federal Reserve Bank also raised interest rates, hitting a high of 5.25% by June 2006
People who had adjustable rate mortgages had their payments skyrocket, and being unable to pay, they defaulted on their loans. The number of foreclosures and repossessions increased drastically.
(April 2007) New Century Financial Corp, a leading subprime mortgage lender, filed for bankruptcy. As more people defaulted, the supply of homes increased, causing prices to plummet (hitting a low in December 2008). Development, consumer spending, financial institutions’ operations, and investment markets all decreased.
With the housing market booming, several large firms became interested in mortgage-backed securities. They lowered their standards to increase the supply of these high-risk investments. When people could no longer pay the adjustable rates, they defaulted on their loans. Housing prices plummeted, and the firms were now stuck with these subprime mortgages as collateral.
II. The Great Recession Timeline 2005-2010
“Too Big to Fail” Mentality - Belief that financial institutions are so large and interconnected that the government must provide support when they face potential failure, as their failure would be catastrophic to the larger economy. In the Great Recession, this led to moral hazard, where these financial institutions invested in high-risk high-return mortgage-backed securities because they were somewhat protected from potential consequences
Lehman Brothers filed for bankruptcy, and Bear Stearns and Merrill Lynch were sold at fire sale. The Troubled Asset Relief Program (TARP) was signed into law through the Emergency Economic Stabilization Act of 2008 in October of 2008, giving the Treasury $700 billion dollars (about 851.9 billion as of 2019) to stabilize/bailout banks and allow homeowners to refinance their mortgages. The Feds lended $85 billion (about 103.4 billion as of 2019) to American Investment Group (AIG) and also bailed out the Big Three Automakers. Fannie Mae and Freddie Mac received $190 billion (about 231.3 billion as of 2019) in bailout funding. Morgan Stanley and Goldman Sachs became commercial banks to receive access to credit from the Federal Reserve
The Dodd-Frank Law was passed in 2010, aimed to help keep banks from becoming “too big to fail” and prevent a similar issue in the future. It increased transparency, prevented banks from taking on too much risk, created councils to identify warnings of financial instability, and limited the amount of risk banks could take on. It also limited the amount of money given through TARP from $700 billion to $475 billion (about 851.9 billion to about 571.3 billion as of 2019)
Since many financial institutions were “too big to fail”, they invested heavily in high-risk high-return mortgage-backed securities knowing they were somewhat protected from potential consequences. Although Lehman Brothers fell, the government spent billions bailing out other institutions. To prevent a similar situation in the future, the Dodd-Frank Law was passed in 2010.
III. The Great Recession Timeline October 2007 - March 2013
Stock Market Plummets - Due to the sudden increase in foreclosures and the housing bubble burst, the stock market lost more than half of its value (from over 14,000 to 6,547 in one year). According to Forbes, the stock market fell by 49% in 16 months1. Its lowest point was on March 9, 2009.
Americans suffered huge losses, with one-fourth of American families losing at least 75% of their wealth2. In December 2008, the Feds reduced the national target interest rate to zero percent for the first time ever to boost the economy. The American Recovery and Reinvestment Act (ARRA) took effect in February 2009 with a $787 billion (about 961.7 billion as of 2019) economic stimulus package.
In March of 2013, the Dow Jones regained the losses from the Great Recession, closing on March 5, 2013, at 14,253.77.
The stock market lost about half of its value in roughly 16 months, causing many Americans to suffer huge losses. After cutting interest rates to zero and passing a large economic stimulus package, the markets finally returned to its high by March of 2013.
At the end of the Great Recession, the negative impacts lingered. Although the U.S. government managed to bailout struggling financial institutions and provide support for small businesses, some financial institutions and businesses still went under and millions of Americans were unemployed, causing them to lose a large portion of their net worth. While it took the stock market about four years to return to its Pre-Recession high, unemployment only reached its Pre-Recession low about ten years later in 2017. It was only through government intervention that the economy began its path of recovery. Important bills such as the Troubled Asset Relief Program (TARP), which bailed out and stabilized banks, and the American Recovery and Reinvestment Act, which was a large stimulus package specifically aimed to save and create jobs, were the key stepping stones of this recovery. While the Great Recession occurred over a decade ago and most have since recovered from it, this economic crisis provides a useful resource for future economists to study to prevent a similar crisis from occurring.
Recession of 2006-2010 RECAP
- Negative Impact Factors
- Subprime Mortgage Crisis
- Overconfidence and “Too Big to Fail” Mentality
- Stock Market Plummets
- Unemployment Rates
- Positive Key Recovery Indicators
- Military Conflict
- Federal Reserve Intervention
- Bank Bailouts
- Cutting Rates
- Economic Stimulus
STOCK MARKET PLUMMETS
↓49% in 16 Months
Data Source: Wall Street Journal
2020 LEADING TO THE PANDEMIC
Leading up to the pandemic, US had the longest economic expansion on record (see graph below)
We were in unprecedented economic growth that was halted by an external factor. Before COVID 19, the U.S. economy expected to maintain low unemployment and slight GDP growth. In 2019, global growth was projected to rise to 3.3% for 2020. However, in June 2020, the global growth is projected at -4.9%, which is 1.9 percentage points below the April 2020 prediction. The 2021 GDP prediction now is 6.5 percentage point lower than its pre-Covid 19 projections of January 2020.
CAUSE AND EFFECT
- Great Depression: To help incentivize the economy, the U.S. government implemented the New Deal to create jobs and lower the unemployment rate.
- Great Inflation: The Federal Reserve increased interest rates in order to decrease inflation and slow money growth to eventually stabilize the economy
- Great Recession: To regain confidence in the economy, the U.S. government passed two economic stimulus packages, one to bail out the failing financial institutions and one to save/create jobs to stabilize the economy
- COVID-19 Recession: In order to give people a living wage to survive whilst being quarantined at home, the U.S. government introduced a 2.3 trillion-dollar stimulus package for people to survive.
- The Great Depression: In order to help revitalize small businesses, the U.S. government created the Reconstruction Finance Corporation to lend money to failing businesses.
- Great Inflation: The implementation of wage and price controls resulted in the creation of the Employment Cost Index (ECI) to provide adequate employee compensation. Congress enacted the Occupational Safety and Health Act to reduce the number of workers killed while on the job.
- Great Recession: The U.S. government passed the American Recovery and Reinvestment Act of 2009, sparking economic recovery and growth and creating or saving millions of jobs.
- COVID-19 Recession: Under the CARES Act, the U.S. government extended unemployment benefits and increased unemployment payments. They also provided loans/grants to save small businesses during the recession.
PARALLELS BETWEEN RECESSIONS
- The Great Depression: The U.S. government implemented the New Deal.
- Great Inflation: The Federal Reserve increased interest rates.
- Great Recession: The U.S. government passed two economic stimulus packages.
- COVID-19 Recession: 2.3 trillion-dollar stimulus package.
- The Great Depression: Reconstruction Finance Corporation.
- Great Inflation: Employment Cost Index (ECI) & Occupational Safety and Health Act.
- Great Recession: American Recovery and Reinvestment Act of 2009.
- COVID-19 Recession: CARES Act.
GLOBAL GROWTH FOR 2020
ECONOMIC VISION BOARD
COULD THIS BE THE FUTURE?
- The housing market had a sharp drop but also a steep climb (after 9/11)
- A potential similar recovery due to a steep drop as well
- May – 2.73 million jobs gained, June – 4.79 million jobs gained, and July – 1.8 million jobs gained
- States rolled back on restrictions, so economists do not expect numbers to increase drastically anymore (July gain < June gain)
- Due to temp $600 federal benefit supplement experience in July, and next stimulus package still in the works because parties cannot decide: Scott Anderson (Chief Economist at the Bank of the West) stated that it is likely that will be the best job report we will see for a while.
- There is no bump in benefits leads to decreased spending.
- The decreased spending leads to more employee cuts and decrease in production.
- Retail sales have surprisingly come close to pre-crisis levels, a screeching halt (people losing confidence in the economy again)
- COVID-19 created a sharp contraction in the economy in March 2020, that resulted in a 5.0 percent decline in real GDP at an annual rate in the year’s first quarter. Also, a 32.9 percent in the second quarter.
- A key question many economists are wondering, if the annual growth rate would be sustainable over time. Most analysts believed that the 2017 tax cuts and program funding that Congress additionally enacted in 2018 (early) boosted the GDP – only temporarily.
- The Trump administration projected that the growth would continue at around 3.0 percent in the coming years.
- In contrast, CBO projected that the growth would fall to under 2.0 percent over the longer term
- CBO projects that the economy will begin to grow again in the second half of the year while remaining in a slump (with unemployment averaging 8.4 percent in 2021).
- https://www.bbc.com/news/business-51706225 = world economic impact with graphs
- U.S. retail sales fall 8.7% in March 2020: largest month-to-month decrease in retail ss since at least 1992.
- “Early estimates predicated that, should the virus become a global pandemic, most major economies will lose at least 2.4 percent of the value their gross domestic product (GDP) over 2020, leading economists to already reduce their 2020 forecasts of global economic growth down from around 3.0 percent to 2.4 percent. To put this number in perspective, global GDP was estimated at around 86.6 trillion U.S. dollars in 2019 – meaning that just a 0.4 percent drop in economic growth amounts to almost 3.5 trillion U.S. dollars in lost economic output. However, these predictions were made prior to COVID-19 becoming a global pandemic, and before the implementation of widespread restrictions on social contact to stop the spread of the virus. Since then, global stock markets have suffered dramatic falls due to the outbreak, and the Dow Jones reported its largest-ever single day fall of almost 3,000 points on March 16, 2020 – beating its previous record of 2,300 points that was set only four days earlier.”
Thank you for participating in our program. Please keep us updated on your own personal and professional observations of the recovery and opportunities ahead.
OTHER ITEMS FOR REVIEW
The Guide to Identify #FAKENEWS
COMMERCIAL REAL ESTATE INVESTMENT RESEARCH POWER POINT
AUGUST 11, 2O2O ZOOM
April B.: Should we use Covid-19 to push forward our government’s technology?
Robert D.: Covid-19 has taught millions of Americans how to adapt to these times. I think technology will become a bigger piece of the pie for businesses. Platforms like Zoom are highly efficient, and more people will begin to use them. The only problem with the CCC today, would be that the government gave civilians jobs that were mostly construction based. Now, it is up to the individual business owner on how they would like to approach this situation. More people will begin to convert to a more technological approach with their business model.
Tatyanna K.: I feel that with school and everything else, technology does allow for great opportunities in the future and allow businesses to grow in that sense.
Shauna B.: Do you think if the government were to upgrade it’s technology, would that create a lot of jobs?
Joe K.: I think a lot of businesses are currently going through the process of reimagining what they can do.
Shauna B.: Did that answer your question April?
April B.: It did. I also really agree that if the government can get up to date with its technology. A lot of the systems are government sits on are very antiquated, and their sitting on software from the 1980s. I think it is very difficult to input adequate policy with such inadequate technology.
Gary B.: The only thing I got is that they get 15$-20$ an hour working regularly, and their unemployment check is 25$. Its so ridiculous its not even worth talking about.
Shauna B.: What do you think you have to do as an employer to help entice people to want to come back to work? And the unemployment checks will end.
Gary B.: I think we just have to bear it out, because there is a limit as to how much we can raise prices. Its all self-defeating because when I first came to Las Vegas there was dinner with bands and then a show and it was fabulous. As they needed more money and prices went up and up and up, they started cutting down on these orchestras and live performances.
Shauna B.: Does one of our interns want to address that? about stimulating the economy instead of just writing a blank check to people who are not working. What do you think is going to happen when that unemployment runs out? Are people going to go back to work, are employers going to have to pay more money?
Robert D.: I believe once the unemployment checks do stop, people will go back to work, but I think it will be in a different way then what they are used to. I feel like time might be split between the workplace and online. Where they are in the office for less hours, but they do work from home as well. There are some things you just do not need to be in an office to do. I think that is going to be the major change we see; I do not think people are going to not want to go back to work. By the time, those unemployment checks do stop, it will be mostly over, and most people will have been exposed to Covid-19. That is a long way down the road but, people will want to go back to work and get a sense of normal back.
Gary B.: There are so many jobs out there where you can’t work from home, they have to go in and take care of business, but this is on the government and we can’t control that. If they made an x amount of dollars, then the unemployment should be based on that. Which would cover the cost of their living.
Shauna B.: And unfortunately, a lot of people using their assistance for consumables like, people travelling to Las Vegas who otherwise would not have ben able to afford coming here are flying here because they received a 600$ a week check and their coming here, is actually quite a terrible sight to see. And the people who would usually come, good income earners are not coming right now because they are currently working through the pandemic and have sense enough to stay away for the time being. For people who cannot pay their rent or their mortgage, the stress is now moved onto the lenders. This is a really hard question for our interns because they have not considered this up until now, this project was mainly focused on Commercial Real Estate so lets consider just that factor, that office renters are not paying their rent, owners of the apartments are not getting payed and there is now that pushback on the banks and they also have a moratorium that they cannot enforce their loans, is there something in history with this kid of push, your mentioning banks failing, runs on banks, this pressure through the commercial real estate is going to be pushed to the bank, what impact are you seeing a parallel of inflation or from the recession? Do you guys have any insight on that?
Robert D.: The biggest comparison I would be able to make is in the Great Depression it is very similar to how it is now that we have no idea how to respond to the situation and our government is still working out all the details on exactly how to respond and it was the same way in the Great Depression, it took them years to get it right and that’s why it lasted so long was because they had absolutely no idea what the correct way was to respond. That is why the great recession did not last as long is because we knew better at that point in time. For the Great Depression we had to try a bunch of new and different policies like the RFC was a completely brand new idea when it came out and it was revolutionary, we need to come up with some form of policy that we think might combat these side effects of everyone staying at home and I believe that is the best we could hope for.
Deb P.: I think this is going to be one of the big effects of this whole Covid-19 is on real estate, that people are not being evicted and people are not paying their rent so where are the landlords getting their money, I think there are going to be a lot of foreclosures that end up happening through this time period and after this time period. Ultimately, I think real estate is where we are going to see the biggest effect and in Las Vegas we are going to see a big effect on real estate. Because we have so many people who are employed in the hospitality industry, much like Gary was saying, in the hospitality industry they cannot do their job from home. As we see casinos, I have read reports that the occupancy may be 10% during the week and on the weekends maybe 50%. There will be people who after Covid-19 is over won’t be getting their jobs back until people are able to go out to Las Vegas and be safe.
Shauna B.: For those who don’t know Deborah Pierce, she is the former CFO of hotel gaming companies across the United States, so we really appreciate your comments Deb.
Lynette P.: Las Vegas during the Great Recession was the #1 foreclosure city in America and what happened when the real estate market collapsed so many people’s values of their home fell below what they owed in their mortgage. Today I am fortunate that even in Covid-19 a state like Texas that has such a diversity of industry. It has strong healthcare, oil and gas which is still a robust industry, you don’t see as much of an impact as far as real estate goes people are still buying houses, its at a slower rate but people are still buying houses. We are fortunate because we do not have as many people who are totally shut down from people being able to work in their industry. Even if you are in the healthcare industry you are still working. My concern is that now as a landlord, I got out of my commercial lease because I could not have face to face meetings with anyone in my profession, but I am able to have consultations through Zoom so that the way of dealing with clients but I didn’t need to have the overhead of a Law Office in downtown San Antonio but as the renter I was impacted but now also as a landlord of residential properties, some people who lease to me have been able to apply to non-profits where I am still being payed but how long will that last. Fortunately, the properties I’m leasing have no mortgage. The one question I did have for Robert and the other interns is that because I am so removed from the agricultural world, what parallels are you seeing between the Great Depression agricultural industry struggles into present day? That really struck me because that is something I am so removed from.
Robert D.: I am glad to say that between now and the Great Depression we have much more of an emphasis on agriculture as a nation and as a market. Agricultural technology in the last 40 years has expanded exponentially and the agricultural industry is actually doing pretty well and one thing that has changed is the gap in pay between farmers and people who live in the city, and city people do make more money but the gap has closed greatly. I think that is a good thing. No matter what people need to eat so there will always be a demand for food, grocery stores are stocked and when you go to the grocery store your not worried if they are going to have enough lettuce or any other product you might want other than toilet paper. Food shortages are not something we really deal with in our lives as Americans. The biggest parallel I see is how scared people were during the Great Depression because people had no idea how to respond, because once the market started dipping, they had no idea what to do. I think now, we are in a better position because we have lived through all these recessions and we have learned how to respond, we need to take what we have learned and we need to create a job creation program because people who work in person, especially here in Las Vegas are going to need to find new jobs outside of hospitality. It is going to be a while before people start coming back to Las Vegas and start blowing money at the casinos because they are going to need financial security before that happens. We also have the highest unemployment rate in the country is right here in Las Vegas. I think if any programs are created, the first place they will be tested is here.
Shauna B.: I think that’s a good point and we saw that in the 2006 recession that it hit Las Vegas residential very hard and some other areas of the country were not impacted as badly, a lot of this is going to depend on your primary industries and the impact that will have in this case the closures of Covid-19, but Joe I wanted to see if you wanted to respond to any of those last two questions?
Joe K.: I wanted to actually add on top Bobby’s point with the agriculture industry, I personally did not research this area but there were a lot of external factors affecting the agriculture industry like the dust bowl and the fact that the agricultural industry was not regulated back then, and with the current crisis, so many people are now environmentally cautious, the agricultural industry is much better regulated then it was back then.
Tatyanna K.: I was meaning to point out unemployment as well with unemployment rising during the Great Inflation with the federal reserve putting high interest rates to lower inflation.
Shauna B.: This is an indicator that we might enter an inflationary period and that is something we will have to address. Randy Prince if you have any questions?
Randy P.: First of all, I would like to congratulate the interns for the research and presentation they did. I have a couple of questions and one comment. The comment is on real estate, I think landlords are going to be affected more than residential ownership, the houses are still selling as everyone said but the instability for the landlords in both residential and commercial is really the key. When we look at these three scenarios, is there a relationship between cause to cure that seems to follow through? Or do you think that each of these are stand alone cases where there really is no common thread amongst them?
Joe K.: I think one thing that was in all the recessions was government intervention through stimulus packages or something like that. Everything has a domino effect with the travel industry, the hospitality industry because consumers do not have enough money to spend in that area until they get their jobs back or receive spending money.
Shauna B.: Thank you Joe, were just sharing a screen which is a vision board which just shows some of the correlating factors that they found from their research. That may be helpful for you Randy. The top is showing economic downturn areas and the bottom is showing economic recovery indicators. We believe that these bottom factors showed a positive and pretty immediate impact.
Randy P.: If we look at today’s recovery progress we have reached a 0% interest rate, we have $2.3 Trillion dollars invested in recovery and another $1.3 Trillion on the market, is it going to be necessary in your mind for the government to keep funding the recovery.
Robert D.: I think for a short time, yes, until they can come up with a better program or policy. What they are trying to do right now with the stimulus package is help every individual American. What they need to do is they need to narrow their focus and focus more on landlords and people who need to be present for work and find solutions there.
Shauna B.: Yeah so it needs to be specific to the sector and not just across the board and that unemployment I do agree is going to be the key. If unemployment keeps going up it will be like how it was during the Great Inflation, what we saw as unemployment rose inflation did as well. I think that will be a key indicator to watch.
Joe K.: I think one difference is the cause of the unemployment or the reason for the unemployment, previously businesses would have to close because they were failing on their own where today it is due to reasons outside of their control. At least in my area gyms are not open and restaurants wont seat people inside, so for some people who want to go back to work are unable to.
Amadeo, K. (n.d.). Great Depression Timeline. Retrieved June 23, 2020, from https://www.thebalance.com/great-depression-timeline-1929-1941-4048064
Romer, C., & Pells, R. (2020, May 18). Economic impact. Retrieved June 23, 2020, from https://www.britannica.com/event/Great-Depression/Economic-impact
The Great Depression. (n.d.). Retrieved June 23, 2020, from http://www.americaslibrary.gov/jb/wwii/jb_wwii_stockmrkt_1.html
Glass, A. (2009, July 08). Great Depression hits bottom, July 8, 1932. Retrieved June 23, 2020, from https://www.politico.com/story/2009/07/great-depression-hits-bottom-july-8-1932-024654
Segal, T. (2020, June 12). What Was the Great Depression? Retrieved June 23, 2020, from https://www.investopedia.com/terms/g/great_depression.asp
The Great Depression. (n.d.). Retrieved June 23, 2020, from https://www.pbs.org/wgbh/americanexperience/features/dustbowl-great-depression/
Ali, W. (2017, November 10). Top 5 Causes of the Great Depression – Economic Domino Effect. Retrieved June 23, 2020, from https://www.warhistoryonline.com/history/top-5-causes-great-depression-economic-domino-effect.html
Roos, D. (2018, December 20). Here Are Warning Signs Investors Missed Before the 1929 Crash. Retrieved June 23, 2020, from https://www.history.com/news/1929-stock-market-crash-warning-signs
Housing 1929-1941. (2020, June 23). Retrieved June 23, 2020, from https://www.encyclopedia.com/education/news-and-education-magazines/housing-1929-1941
Dow Jones - DJIA - 100 Year Historical Chart. (n.d.). Retrieved June 24, 2020, from https://www.macrotrends.net/1319/dow-jones-100-year-historical-chart
Online TAKS Practice. (n.d.). Retrieved June 25, 2020, from http://www.phschool.com/curriculum_support/taks/pathways_1.cfm?unit=5
New Deal Mistakes. (n.d.). Retrieved June 25, 2020, from https://newbaddeal.weebly.com/new-deal-mistakes.html
Great Inflation -
Bernanke, Ben. “The Great Inflation and Volcker Disinflation.” Board of Governors of the Federal Reserve System, March 2012, https://www.federalreserve.gov/aboutthefed/cls-timeline/timeline/timeline_video.htm?02-05-5.
Blinder, Alan. “The Anatomy of Double-Digit Inflation in the 1970s.” National Bureau of Economic Research, 1982, https://www.nber.org/chapters/c11462.pdf.
Elliot, Kimberly. “Stagflation and the Oil Crisis.” Khan Academy, https://www.khanacademy.org/humanities/us-history/postwarera/1970s-america/a/stagflation-and-the-oil-crisis.
Irwin, Nelson. “A Rerun From the 1970s? This Economic Episode Has Different Risks.” New York Times, 18 Sept. 2020, https://www.nytimes.com/2019/09/18/upshot/us-economy-1970s.html.
Keefe, John. “What Causes Inflation? Lessons from the 1970s.” CBS News, 22 May 2009, https://www.cbsnews.com/news/what-causes-inflation-lessons-from-the-1970s-vol-3/.
Kent, Christopher and Philip Lowe. “Property-Price Cycles and Monetary Policy”, Reserve Bank of Australia, https://www.bis.org/publ/confp05m.pdf.
Kramer, Leslie. “How the Great Inflation of the 1970s Happened.” Investopedia, 29 April 2020, https://www.investopedia.com/articles/economics/09/1970s-great-inflation.asp#:~:text=The%201970s%20saw%20some%20of,this%20decade%20of%20high%20inflation.
Nelson, Edward. “The Great Inflation of the Seventies: What Really Happened?” The Federal Reserve Bank of St. Louis, January 2004, https://fraser.stlouisfed.org/files/docs/meltzer/nelgre04.pdf.
Meeks, Roland. “Financial Crisis Casts Shadows Over Commercial Real Estate.” Federal Reserve Bank of Dallas, December 2008, https://www.dallasfed.org/research/eclett/~/media/documents/research/eclett/2008/el0812.pdf.
Meltzer, Allan.”Origin of the Great Inflation.” Federal Bank of St. Louis, April 2005, https://files.stlouisfed.org/files/htdocs/publications/review/05/03/part2/Meltzer.pdf.
Nielson, Barry. “Stagflation in the 1970s.” Investopedia, 25 Feb. 2020, https://www.investopedia.com/articles/economics/08/1970-stagflation.asp.
Riddell, Tom. “Inflationary Impact of the Vietnam War.” Vietnam Generation, 1989, https://digitalcommons.lasalle.edu/cgi/viewcontent.cgi?article=1003&context=vietnamgeneration#:~:text=The%20increased%20spending%20for%20the,inflationary%20spiral%20of%20the%201970s.
Roos, Dave. “How the U.S. Got Out of 12 Economic Recessions Since World War Ⅱ.” History, https://www.history.com/news/us-economic-recessions-timeline.
Ruff, Jon. “Commercial Real Estate: New Paradigm or Old Story.” Bernstein Journal: Perspectives on Investing and Wealth Management, Fall 2007, https://www.alliancebernstein.com/Research-Publications/CMA-created-content/PrivateClient/PDFs/50122_CommercialRealEstate_NewParadigmOrOldStory_BJF07.pdf.
Great Recession -
Amadeo, Kimberly. “When and Why Did the Stock Market Crash in 2008?” The Balance, 7 Apr. 2020, www.thebalance.com/stock-market-crash-of-2008-3305535.
Coghlan, Erin, et al. “What Really Caused the Great Recession?” Institute for Research on Labor and Employment, 19 Sept. 2018, irle.berkeley.edu/what-really-caused-the-great-recession/.
Ericson, Cathie. “What Caused the Great Recession in 2008-and What Can We Learn From It?” Acorns, www.acorns.com/money-basics/the-economy/what-caused-great-recession-of-2008/.
Pfeffer, Fabian T., et al. “Wealth Disparities Before and After the Great Recession.” The ANNALS of the American Academy of Political and Social Science, vol. 650, no. 1, 2013, pp. 98–123., doi:10.1177/0002716213497452.
Segal, Troy. “Did the Troubled Asset Relief Program (TARP) Save the Economy?” Investopedia, Investopedia, www.investopedia.com/terms/t/troubled-asset-relief-program-tarp.asp.
Trefis Team. “How The Current Coronavirus Stock Market Compares With Great Depression & Great Recession Markets.” Forbes, Forbes Magazine, 28 May 2020, www.forbes.com/sites/greatspeculations/2020/05/28/how-the-current-coronavirus-stock-market-compares-with-great-depression--great-recession-markets/#7dafd3053e1e.
Board of Governors of the Federal Reserve System (US), Effective Federal Funds Rate [FEDFUNDS], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/FEDFUNDS, August 7, 2020
“Civilian Unemployment Rate.” U.S. Bureau of Labor Statistics, www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm.
Journal, Wall Street. “Dow Jones U.S. Total Stock Market Index Historical Prices.” The Wall Street Journal, Dow Jones & Company, www.wsj.com/market-data/quotes/index/DWCF/historical-prices.
“U.S. Foreclosure Activity Drops to 15-Year Low In 2019.” ATTOM Data Solutions, 16 Jan. 2020, www.attomdata.com/news/market-trends/foreclosures/attom-data-solutions-2019-year-end-u-s-foreclosure-market-report/.
Could this be the Future -
https://www.wortfm.org/the-american-economy-before-and-after-coronavirus/ = good to listen to
https://www.marketplace.org/2020/08/10/covid-19-the-numbers/ = good job grap