What was a major cause of the us recession that began in 2008? defaults on mortgages for homesconsumers not buying new homesdamage from hurricane katrinaa rise in the american stock market

The correct answer is defaults on mortgages for homes

The Recession of 2008 was caused by the failure of the regulator to reign in on toxic mortgages. This has also been largely attributed to a breakdown in corporate governance that led to firms acting recklessly in issuing subprime mortgages

The major cause of the United States recession that began in 2008 was defaults on mortgages for homes.

Further Explanations:

On 1st December 2008, “National Bureau of Economic Research” (NBER) of the United States declared nation under the threat of  entering  a great recession. The recession was concluded by citing hiring  and production statistics along with third-quarter decline of  GDP of the nation. The Recession was linked to the subprime mortgage crisis. Subprime mortgages referred to the home loans that were approved to debtors with poor credit accounts. Their home loans were taken as  high-risk loans.  

The “Economic Stimulus Act of 2008” enacted in the constitution of the United State was the act of Congress against the recession , granting several economic stimuli projected to boost the economy of the nation during the recession and avert the recession and ameliorate economic conditions.

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Answer Details

Grade: High School

Subject: History

Chapter: Recession of 2008

Keywords:

National Bureau of Economic Research, United States  ,third-quarter, GDP, subprime mortgage crisis,Economic Stimulus Act of 2008,Congress,economic stimuli, ameliorate economics