The U.S. Economy: What Happened and What’s Next

The stock market closed up 144 points the final Friday of October, putting an end to one of Wall Street's most brutal months. The Dow Jones Industrial Average fell 1670 points in October, taking trillions of dollars in equity value with it. In an effort to woo voters, the presidential candidates scrambled to present solutions, but a panel of faculty from Emory University's Goizueta Business School, gathered to discuss the current state of the U.S. economy, wasn't tempted by their offerings. According to the professors, years of shortsighted decisions dug the hole the U.S. economy finds itself in, and it will take long-term leadership to climb back out.

Moderated by Susan Gilbert, associate dean and director of the Evening MBA Program, the panel discussion, "The Economy: What Happened and What's Next?", touched on the makings of the mortgage meltdown, its effect on the credit and stock markets, and what it will take for the economy to regain its footing. 

So how did the U.S. economy arrive at this point? "Excessive leverage," notes Jim Grissett, adjunct professor of real estate and founding partner of The Parthenon Group. When government-sponsored organizations like Fannie Mae and Freddie Mac lost 2.5% of their collateral, it wasn't good news, but it was "not the end of the world," explains Grissett. But when those loans are leveraged at a 40 to one ratio, it's another story.

Read more at Knowledge@Emory.

About Emory University’s Goizueta Business School

Emory University’s Goizueta Business School is home to an Undergraduate degree program, a Two-Year Full-Time MBA, a One-Year MBA, an Evening MBA, the W. Cliff Oxford Executive MBA (Weekend and Modular formats), a Doctoral degree and a portfolio of non-degree Emory Executive Education courses.