The Great Recession Essay
The Great Recession, as some would call it, has affected myself and my family greatly. Before the stock market collapse in December on 2007, I never paid any attention to the stock market. I saw numbers going up and down on the news, but never understood the implications it truly would have. In 2006 my grandfather purchased a tool company in Dayton, the company had long term lucrative government contracts, all it needed was capital and it would run its self. My grandfather was a person who couldn’t sit still, he had retired three times, he decided to come out of retirement yet again and purchase this company. My grandfather and his lifelong friend/business partner agreed to finance the company together, however my grandfather’s partner passed
…show more content…
This was until a bill by the name of Dodd-Frank was signed into law in 2010. This well intentioned piece of legislation clamped down on banks’ ability to invest in subprime mortgages and offered increased protections to consumers. However the un-foreseen consequences was a little piece of regulation that limits the amount of personal loans out at one time to ten. My grandfather had funded his company with the majority of his liquid capital and taking loans on well over forty rental properties. The impact of this single piece of regulation on my family cannot be understated, the banks sent notices that the notes on the properties would not be renewed, meaning my grandfather would have to pay off his debits immediately or have the banks take his assets. To make matters worse the crash in the housing markets due to Freddie mae and company caused the values of the homes to be worth a fraction of what they were when he took loans out on them. Following two short years after the passage of the Dodd-frank legislation my grandfather had to sell his company, and liquidate a huge chunk of his assets. The impact this had on my family as a whole was devastating, tuition accounts for grandchildren’s college educations were eradicated, extreme debt put on my grandfather’s children(my dad, aunt, uncle) as the properties purchased prior to the collapse housing bubble lost tremendous value. All these years later and it still has a notable impact on every single one of the members in my immediate
This was until a bill by the name of Dodd-Frank was signed into law in 2010. This well intentioned piece of legislation clamped down on banks’ ability to invest in subprime mortgages and offered increased protections to consumers. However the un-foreseen consequences was a little piece of regulation that limits the amount of personal loans out at one time to ten. My grandfather had funded his company with the majority of his liquid capital and taking loans on well over forty rental properties. The impact of this single piece of regulation on my family cannot be understated, the banks sent notices that the notes on the properties would not be renewed, meaning my grandfather would have to pay off his debits immediately or have the banks take his assets. To make matters worse the crash in the housing markets due to Freddie mae and company caused the values of the homes to be worth a fraction of what they were when he took loans out on them. Following two short years after the passage of the Dodd-frank legislation my grandfather had to sell his company, and liquidate a huge chunk of his assets. The impact this had on my family as a whole was devastating, tuition accounts for grandchildren’s college educations were eradicated, extreme debt put on my grandfather’s children(my dad, aunt, uncle) as the properties purchased prior to the collapse housing bubble lost tremendous value. All these years later and it still has a notable impact on every single one of the members in my immediate