Macroeconomics

Posted by Winnie Melda on May 6th, 2019

Article #1 Forcing Banks to Fight Fair

The article on the compelling of banks to fight by the New York Times encompasses the assertion that the consumer financial bureau would allow the consumers to join in class action lawsuits against credit card companies, banks as well as other lenders. The issues that these consumers could sue the banks for include predatory lending, price gouging, abusive loan terms among other mistreatments. For the past decades, banks have required that customers consent to individually arbitrate on any conflicts that arise over products and services instead of suing in court. The arbitration process has however turned to stack the deck since corporations are the ones who set the arbitrators and rules of evidence (The Editorial Board, 2017).

From the assessment of the article, I believe the article is on point as through the ability to sue the banks and other financial institutions; it will be possible to remedy the injustice and unfairness consumers have suffered in the hands of the banks. The fact that it is the banks that set the rules in the arbitration process implies that they will be the rules to their side. The assertion, therefore, is that the only way consumers can enjoy fairness and reparations for poor treatment by the banks is by joining in class action lawsuits against the banks. Through this, it will be possible to exert some form of fairness and regulation of the banking sector.

The article creates a major correlation on the issues I have learned encompassing the regulation of the banking sector. Consumers have for a long time been exposed to exploitation from the financial institution due to the poor regulations in the industry, but the issues brought forward by the consumer financial bureau will ensure sanity resumes in the industry.

Article #2 Current U.S. Federal Budget Deficit

The article assesses the current US federal budget for the fiscal year 2018 and asserts it is at 0 billion. Overall, the cause of the deficit is because the spending by the US government of .094 trillion is more than its revenue of .65 trillion. The main reasons for the budget deficit can be traced to the 9/11 attacks that led to the doubling of the military budget. Further, the issue of mandatory spending through the payouts for social security and the 7 billion economic stimulus program additionally added to the 2009 deficit. The increased government spending is associated with positive economic stimulation and thus creates a stronger economy (Amadeo, 2017).

I believe the article brings out unique issues on the deficit in the US. The prevailing issue is that the government has been traditionally condemned for their spending that has been seen as the core reason for the increasing deficit. The assertion, however, is that through this spending, the government has been able to increase the strength of the economy and additionally create more jobs. Further, the increased spending has resulted in a safer country through increasing military allocation. The fact that the deficits are still within the manageable range and the existence of countries as China that are willing to lend money to the US, the focus should be on the economic growth.

The article has enumerated issues relating to government borrowing and why the borrowing is good for the economy. It has further highlighted the fact that focus should not be so much on the deficits but on the economic growth generated by the spending of the government revenues and borrowed funds that play a part in increasing the deficit.

References

Amadeo , K. (2017). The balance; Current U.S. Federal Budget Deficit on July 19, 2017

The Editorial Board (2017). The New York Times; Forcing Banks to Fight Fair on July 19, 2017

Carolyn Morgan is the author of this paper. A senior editor at MeldaResearch.Com in best research paper writing services. If you need a similar paper you can place your order from non plagiarized research papers.