Looking back to 2008
We look forward not back
Does your accountant seem obsessed with last year? If you want to legally pay less in taxes, you need a professional who looks forward. Relax Tax helps our clients focus on planning for a better future, and not the past. If we want to look back at anything, we thought it might be fun let our blog look back at what we learned in the last 50 plus years. You can get a FREE COPY of the entire guide at back.relaxtax.com. Now lets take a look at 2008.
2008 Big News Story
Lehman Brothers Declares Bankruptcy
March 2008: The Demise of Bear Stearns
By the winter of 2008, the U.S. economy was in a full-blown recession and, as financial institutions' liquidity struggles continued, global stock markets were tumbling the most since the Sept. 11 terrorist attacks. In January 2008, the Fed cut its benchmark rate by three quarters of a percentage point — its biggest cut in a quarter century, as it sought to slow the economic slide.
The Fed started slashing the discount rate as well as the funds rate,10 but bad news continued to pour in from all sides. In February, the British government was forced to nationalize Northern Rock.11 In March, global investment bank Bear Stearns, a pillar of Wall Street that dated to 1923, essentially collapsed and was acquired by JP Morgan Chase for pennies on the dollar.
September 2008: The Fall of Lehman Brothers
By the summer of 2008, carnage was widespread across the financial sector. IndyMac Bank became one of the largest banks ever to fail in the U.S.,13 and the country's two biggest home lenders—Fannie Mae and Freddie Mac—had been seized by the U.S. government.14
Yet the collapse of the venerable Wall Street bank Lehman Brothers in September marked the largest bankruptcy in U.S. history,15 and for many was a symbol of the devastation caused by the global financial crisis. That same month, financial markets were in free fall, with the major U.S. indexes suffering some of their worst losses on record as the Fed, Treasury Department, White House and Congress struggled to put forward a comprehensive plan to stop the bleeding and restore confidence in the economy.
The Wall Street bailout package was approved in the first week of October 2008.16 Its passage stabilized stock markets, which would hit bottom in March 2009 and begin the longest bull market on record. Still, the economic damage was immense. Though the Great Recession officially ended in 2009, many ordinary people suffered from its effects for years after as the job market was slow to recover and housing prices remained suppressed.
2008 by the Numbers
Economic Data from 2008
Grocery Prices from 2008
Personally, it was 2008 and the impact that it had on my clients that shaped Relax Tax. What became very clear was that helping people to address their taxes was just not enough. Our clients had many more areas were they needed assistance. 2008 started me on the journey that has lead us what Relax Tax is in 2020.
A tax return is just a historical record of what happen financially in the previous year. If you don't think about your taxes until you start receiving your tax forms, then it is already too late. Click Here to schedule your risk free tax planning session.
If your tax preparer isn't doing tax planning with you, then you have the wrong tax preparer. If you do your taxes yourself with software and just "tweak" the numbers till you get the numbers where you want them then you should read our blog post on what could be in store.