| Summary: | 碩士 === 佛光大學 === 政治學系 === 96 === The U.S.A government started the subprime mortgage service in 1980. The subprime mortgage crisis is an ongoing economic problem manifesting itself through liquidity issues in the global banking system owing to foreclosures which accelerated in the United States in late 2006 and triggered a global financial crisis during 2007 and 2008. The crisis began with the bursting of the US housing bubble and high default rates on "subprime" and other adjustable rate mortgages （ARM） made to higher-risk borrowers with lower income or lesser credit history than "prime" borrowers. Loan incentives and a long-term trend of rising housing prices encouraged borrowers to assume mortgages, believing they would be able to refinance at more favorable terms later.
However, once housing prices started to drop moderately in 2006–2007 in many parts of the U.S., refinancing became more difficult. Defaults and foreclosure activity increased dramatically as ARM interest rates reset higher. During 2007, nearly 1.3 million U.S. housing properties were subject to foreclosure activity, up 79% from 2006.
The risks to the broader economy created by the financial market crisis and housing market downturn were primary factors in several decisions by the U.S. Federal reserve to cut interest rates and the economic stimulus package passed by Congress and signed by President George W. Bush on February 13, 2008. Both actions are designed to stimulate economic growth and inspire confidence in the financial and currency markets.
President George W. Bush raise the debt to start with the war against Iraq and anti-terrorist , but he did not recognize the serious problems in the value of credits and the financial balance in mortgage market, in order to change the price of oil and trigger the oil crisis. There for, this essay is to research the situation of the subprime mortgage crisis and the mistakes that George W. Bush had made.
Keywords: subprime mortgage, George W. Bush, US. Dollars, Oil Crisis, credit
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