President Obama held meetings with the heads of some of the nation's largest banks. Read about the meeting in the New York Times and explain in the comments section why Obama wants banks to lend more. Be sure to use terminology and vocab from our unit on Economic Policy. Your comment will be marked as a quiz grade.
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16 comments:
Obama wants banks to lend moe money because he said that business and consumers, large and small, are all in the same boat. Also, since more banks will be lending money, more money is put into the economy, which would effectively help move us out of the depression and moe to equalibrium.
Peter Knox
Obama wants to increase lending by banks to increase the aggregate demand and thus supply businesses with more funds to create more jobs; he justified his stance by referring to the economic bailout previously given to banks
Obama called for a meeting with officials from several large financing institutions to let them know that it is basically their industry's responsibility to loan even more money out this year to small businesses now that they are in a surplus. This would be a way to repay the nation for how it saved the banks from bailing out last year through tax increases.----- Kevin donahue
Obama states that since the American people have paid the taxes that helped the bank get back up on their feet when they hit a rough spot with their money, the banks should loan us money to sort of pay us back and help our economy grow by increasing the aggregate demand.
Zoë Willis
President Obama is pressuring banks to loan more money to small businesses and people in order to increase the aggregate demand in the US. Since the productive capacity in the united states is higher than the aggregate demand, the A.D. should be increased to fight unemployment, which is brought on by high productive capacity. The banks loaning money will disperse money among people that is currently held by the banks and not able to be spent. If it is loaned, people will use it to buy "stuff" and the relationship between A.D. and P.D. will reach an equilibrium, meaning lower unemployment.
-Maggie Ambrose
The reason that President Obama wants to increase the amount of money that banks lend is because with more lending, there would be an increase in aggregate demand. The economy right now, having the issue of unemployment, would mean that there is a much greater productive capacity relative to our aggregte demand. If banks would lend more then it may diminish the gap between aggregate demand and producive capacity and begin to stabilize the economy.
-- Kathy H.
Obama met with some of the biggest banks in America to try and make them lend more cash to small businesses and regular people. The banks said that they would start lending a bit more, thus bringing more money into the economy to spend with. With more aggregate demand into the economy then more stuff will be bought. This should atleast help the economy stabalize a bit when people have mony to buy and spend with again.
~Abdullah Mamun
Obama wants banks to lend more because it will push money into the economy to combat the economic slump. By pushing this extra money into the economy, Obama wants to use a technique called deficit financing to stimulate aggregate demand
Obama basically wants banks to lower their requirement on loaning out money for smaller businesses. He says that the bailouts for the banks have helped them out tremendously and he wants to see the banks help stimulate the economy and get out of this resection.
Daniel Veizaga
December 15, 2009 10:28 AM
President Obama had a meeting with some of the larger banks of America. He said that it was their duty to help bring the economy back to it's pride and joy. The bigger banks need to donate more money to help the economy back on it's feet, instead of making sire that people can keep their multi million dollar paychecks. The money will help smaller buisness to stay open and hopefully create more jobs in the future
Jeremy Seipp
Obama helped banks when they needed extra help so now he expects the banks to help rebuild our economy. Obama pressured the biggest banks to take extraordinary steps to revive lendinding money to small businesses and homeowners prompting assurance.
I think that obamas devotion to get of out of recession is by basically spending more money by using the monetary policy which he hopes to help the economy by people having the opportunity to start expanding or startibg their own business with the efficient loans that be given from banks. This in general seems like a common of the keyshan theory which trust our govertneng to go us pathway to an equillibrium between supply and money. Which would result in an increase in jobs available and would bring upon a stable economy unlike the one were previously at due to the arrogance of people and excesive loans that were given to the public and let to foreclose either goods or their homes cause of the lack of knowledge of how the system works and how latent interest. In the end this is a positive step towards people being able to trust the banks and specially their goverment that hopefully will not go against their word to get people out of crisis and hopefully just end up with people starting to make new stocks.
President Obama wants banks to lend out more money because he feels that they have recovered and now have enough money to lend out and start paying back what they owe. He says that by lending out more money, the economy will grow. And he feels that creating new jobs is not enough to get our economy back to normal, so he's turning to lending out more money, to raise aggregate demand since there is unemployment.
Gabriela Toledo
Obama wants the bank executives to lend more money and make more loans to small businesses stimulate the economy. If the government can make more money, they can increase aggregate demand. Also more jobs can be issued and bring down the unemployment rates.
-malayika cincotta
The loans will create new oppertunities for business, jobs, employment ect. and give people more spending money or lower uncontrolable outlays. Although it is a source of the problem now. Obama is saying that not only does the government need to put money in the economy but the banks needs to do the same thing because even with risk if they don't the economy won't improve.
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