Economists believe that the great recession was not a depression, and it was all possible because of Federal endeavors. They arrived at this result by going through an independent study of financial and economic policies. They analysed bank rescue deals, tax credit of home-purchasers and Cash for Clunkers stimulus plan.
However, well-known economists, Alan Blinder and Mark Zandi said that the steps taken to ward off the economic slump are still engulfed by controversies. Critics feel that the policies were misleading and useless.
Alan Blinder, a professor of economics at Princeton University, and Mark Zandi, Chief Economist for Moody’s Analytics, wrote, “The stimulus has done what it was supposed to do: end the Great Recession and spur recovery”.
During a telephone conversation, Blinder said that no external organization sponsored the study, and neither was it analysed by anybody before it was made public. The study appeared in “How the Great Recession Was Brought to an End”, this week.
According to the research, the national redundancy rate was held at around 1.5 percentage points below by the stimulus deal. And almost 2.7 million jobs were added to U.S. payrolls.
An even greater recovery push came from the Troubled Asset Relief Program, commonly called the bank bailout, and the monetary policies employed by the Federal Reserve, Blinder and Zandi said.
Blinder and Zandi were of the opinion that the Troubled Asset Relief Program, usually known as the bank bailout, along with fiscal policies adopted by the Federal Reserve, made ground for a bigger recuperation from the economic recession.