U.S. Stock Market Crisis

The recent stock market crash that happened in the U.S. has now quickly become a global crisis. Not only are U.S. investors in a panic but the recession has also spread to Canada and several European countries. Not only that but it seems that stocks in emerging nations like Europe and Canada plunged even more steeply than in the U.S. as investors in other countries saw the credit crisis as a threat, not just to U.S. investors. But one good thing is that Canada won't be in the slump won't be as serious and long as the U.S. and some European nations, that is because the Canadian banking system is solid and this country's economy is not weakened by growing government debts. But the economy has still been hurt by falling export sales to the U.S. and as people start spending less on daily life as job growth stalls and fear spreads through the economy. Also Canada is hit the harder because it is a big resource exporter and plunging income from the petroleum and other commodities that needed a high export price. But we are still much better than the U.S. and Europe because their banking systems are burdened by massive debts, many of which unlikely to be repaid.

Connections:

The crash would have a serious impact on our economy resulting in a recession which would strike fear in the residents, making them spend less, plunging our country into further recession. That would lead to the government losing money from taxes and going into debt. Not only that but it would affect our schools, health care, community centers, and much more. Also because we have a federal election coming up the next party to come into power would have risen to a position of debt and a shortage of money. So that would lead to prices increasing for our essentials and then employers would have to raise salaries to meet the demands of the prices and that would lead to further increase in prices and that would enter a continuous cycle. Where prices increase salaries increase and government goes into debt. But not only that but the trade companies would have a much harder impact because their most prominent trade route is with the U.S., but now that they can't afford to buy our materials we would lose a large source of income.

Reflection:
This article makes me wonder how come the U.S. let this happen so easily, did they not have any back up plans or something that will prevent the country plunging into a recession. The government is a big factor in this predicament they should have budgeted their spendings in their projects and have a financial plan that would ensure the safety of the economy. But our government has ensured that we would not fall to far as apposed to the U.S. but that does not mean we would not be hurt as much. As the U.S. continues to not buy our trade products would would lose revenue and that would be just as bad. But as the crisis continues we may not know what would be the eventual outcome of this disaster may be but we can only hope for the best.