California, South Carolina and Michigan have suffered incredible financial pain last month as home foreclosures, bankruptcies and unemployment rose. Recent results have shown the most horrible financial crisis ever since the 1930s which has been causing prolonged damage even while other signs show that this recession is going down.
The median stress score of the county, fueled by even worse foreclosures, bankruptcies and unemployment has risen to ten since May, from a little less last April. In the year of 2008, the median stress score stood at 6.2. This pain was much lower back then since the economy seemed to be expanding. In actuality, the end of 2008 happened to be the very last time when the economy showed any growth.
Based on foreclosure, bankruptcy and unemployment in every county, the AP gives a score between 1 and 100. Higher scores show higher economic stress.
Generally, counties are seen as stressed if the scores goes past eleven. By May thirty-six percent of these counties scored at least 11, much higher compared to how it was in April. However, recent readings have been a little better compared to February and March, around which almost forty percent of these counties found themselves above this threshold.
A lot of economists predict that the recession will finally come to an end before this year comes to a close. But even if this does happen, foreclosures, bankruptcies and unemployment are very likely to keep on climbing to cause more harm in a lot of communities. This pain will still stick around, even after the whole recession ends, making for subdued economic recoveries.
A lot of economists claim that the recession has already eased and that this economy could begin to grow once again the minute September hits. Among the states, Michigan, South Carolina and California have shown the highest economic stress within the month of May; their counties scored an average of 16. California was battered by the bust of housing, while Michigan absorbed most of the crisis in the automobile industry. South Carolina has received a little of everything. Construction and manufacturing jobs were hit very hard within this state. A common thread that runs through each of these states would be heavy losses of jobs. Higher unemployment is, in turn, escalating bankruptcies and foreclosures.
This rise in economic stress stems from California, which saddled an enormous budget deficit of almost twenty-five billion dollars, as well as other states scrambling to deal with a fiscal crisis.
Within the previous year, Indiana, Oregon and South Carolina had suffered the highest stress. The job loss in manufacturing has burrowed deeper into the woes of South Carolina and Indiana. Oregon has also been hit by the bust of real estate, as well as the lowering demand for materials for construction such as windows and plywood produced within the state.
Nebraska and North Dakota were the states that were least stressed within the month of May, with their county scores on an average below five. Those states also got the best last year. North Dakota was greatly helped due to the oil business, while Nebraska benefited from a relative strength of food-production and agriculture industries.
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- Is it a Good Idea to Invest in Foreclosure Property? on February 2nd, 2009
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