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The article The Fed and the Great Recession describes the role of the Federal Reserve during the 2008 crisis. It focuses on the implemented monetary policy, which was expansionary in nature, and criticizes its consequences, which were ambiguous (Summer, 2016). The author believes that banks being conservative contributed to the issues, and a better strategy can help avert another crisis (Summer, 2016). Altogether, the author analyzes the situation and offers suggestions for how the Federal Reserve could have improved the policy and avoided considerable drawbacks.
Equity Residential specializes in providing apartments for rent, being a major owner of real estate. It is based in the US and has property in some of the most populated cities. Its business model involves acquiring apartments, managing them, and allowing tenants to live there for rent (Bloomberg, n.d.). The company is responsible for operating about eighty thousand units throughout the country (National Multifamily Housing Council, n.d.). Overall, Equity Residential is a prominent entity in its market.
Expansionary Monetary Policy has certain effects on the economy, impacting it at large and influencing individual firms. For instance, it leads to economic growth, a lower unemployment rate, increased inflation levels, and considerable demand from the government and the population due to the reduced interest rate. Individual organizations may experience difficulties with profitability, stocks, and, depending on the market, customers.
For a manager, it will be challenging to plan anything until the growth is evident, except for the pricing policy, which will reflect the state of inflation. The market opportunities will also decrease, as people will be less willing to rent apartments in big cities and choose smaller ones instead. Managing the existing items may burden the budget, forcing the company to sell or abandon them, which is likely to affect the post-policy situation.
References
Bloomberg. (n.d.). Equity Residential. Web.
National Multifamily Housing Council. (n.d.). 2020 ranking: NMHC 50 largest apartment managers. Web.
Summer, S. (2016). The Fed and the Great Recession: How better monetary policy can avert the next crisis. Foreign Affairs, 95(3), 116-125. Web.
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