In 2008, the United States faced a recession with financial woes not seen since the Great Depression. To answer this question, you will need to identify events that occurred leading up to 2008 that impacted the economy. One of the biggest financial issues of that time was the subprime mortgages issued to home owners. Many individuals bought homes with low interest loans that later adjusted to double digit interest rates. Many of these loans were bought up by Freddie Mac and Fannie Mae, who then turned around and sold them to investment banks. Insurance companies got involved insuring losses if the mortgages went into default. Everyone was making money as the property values continued to raise. However, the housing market began to free fall in 2007. As home values came crashing down, mortgage holders were unable to refinance their homes or sell without owing on their loans. Foreclosures increased dramatically placing financial stress on the mortgage and insurance companies, with some having to be bailed out by the U.S. government. You may also want to look at the deregulation of the banking industry in the 1990s and how it helped create this crisis. You could break your response into three sections including the mistakes of the U.S. government, the U.S. citizens and the banking industry.