US Financial Crisis: Parental Agonies and Kids' (Untold)Anxieties


Code : ECC0037

Year :

Industry : General Business

Region : US

Teaching Note: Available

Structured Assignment : Available

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Subprime to Wall Street to Main Street Since past 25 years, Americans have mostly been spending during good and bad times as well without really worrying about the future implications of their financial dealings. About 43% of the US families actually make less money than they spend. Average credit card debt in households in the US has increased from $3,000 in 1990 to $8,000 in 2004. Except for the first quarter of 1991, when there was a mild decline of 0.4%, consumer spending has always witnessed an increasing trend. However, personal savings rate – income left after consumption – fell from 12% in 1981 to just over zero in 2008

Behavioural Problems in Kids due to Household Problems The financial turmoil due to subprime crisis has created an unpleasant atmosphere in many American families. In many cases, the subprime mess triggered conflicts in parents, which made them cut their expenditure on long drives, weekend entertainments, children's pocket money, expensive clothing, extravagant gifts and parties. The subprime mess, which resulted in either a job loss or an investment loss, shattered the peace ofmind ofmany causing depression and frustration in parents and subsequently creating social problems and anxiety in kids.

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Where are the Soothsayers? The tentacles of subprime crisis deep routed inmany ways leaving thousands of people jobless, drying up investors' investments, blowing up the nation's economy and crippling the budget for children's education and medical care. The phenomenon resembles the upheavals of US society during the Great Depression of 1930s. Most of the children affected by the subprime foreclosures belonged to the families ofAfrican-American and other minorities who struggled to repay their subprime loans due to adjustable rate mortgage payments...

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