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2Coral Reef Sr. High
Fall 2010
Economy continues endless downward spiral
Students’ families have been affected by the economic recession and want to know when it will end
JEREMY MATHURIN
Staff Writer
According to the Sun Sentinel,
the number of home loans in foreclosure
in Florida at the end of last year was 44%
higher than at the end of 2008. And since
the last quarter of the year, it has risen
another 4.5% and has the second largest
number of foreclosures in the country.
This information paired along
with the fact that the filling for bankruptcy
per capita is 2.24 paints a bleak image of
the stability of Florida’s economy. But one
of the most controversial and misinformed
pieces of information is how it happened.
How did the world’s largest superpower
come under the fear and uncertainty of
one of its worst economic recessions in
decades?
“In 2007 I started hearing things
about the economy failing, and there being
a recession. I heard a lot on the news and
the radio talking about it but it was hard to
completely understand the real reason why
we were having trouble with the economy,”
said VPA Junior, David Diaz-Peaz.
Economists have argued this
until they are blue in the face how this
came about. Well, most can agree that this
is because of the dreaded domino effect.
One infinitesimal, seemingly unimportant
event triggers a string of events that can
have cataclysmic effects. The reason
behind the current economic recession
was unequivocally the selling of subprime
mortgages. During the housing boom of the
mid 2000’s, people were buying houses like
crazy. Prices were going up and everyone
was making money. You could easily buy a
run down house for $200,000 and flip it for
twice the amount.
But then things got shady. Banks
or mortgage brokers rather were trying
harder and harder to sell houses and make
more profit. To do so, they began selling
subprime mortgages. To understand
the next events, it is important to fully
comprehend the circumstances behind the
crash.
One of the causes of the current
recession was that the Government was
slow to raise interest rates when the
economy started to boom in 2004. Low
interest rates in 2004 and 2005 helped
created the housing bubble. Irrational
spending set in as many investors took
advantage of low rates to buy homes just to
resell. Others bought homes they couldn’t
afford thanks to interest-only loans.
In finance, subprime lending means
making loans (in this case, a mortgage) that
are in the riskiest category of consumer
loans and are usually sold in a separate
market from prime loans. Because people
were buying mortgages that were subprime
and had a high turnover rate, banks placed
a low down payment but high interest rate
on the mortgages that sky rocketed to make
sure they are making the most amount of
money possible.
In 2006, when higher rates finally
kicked in, declining housing prices caught
many homeowners who had taken loans
with little money down. As they realized
they would lose money by selling the
house for less than their mortgage, they
foreclosed.
“I don’t think I totally agreed
with the idea of bailing out the banking
industry, by just throwing money at it…
but it’s hard to argue that it didn’t end up
helping in the long run. It’s almost scary
to think what would have happened it the
government allowed the banks to fail,” said
VPA sophomore, Adam Batchelor.
As the foreclosure rate increased,
so did the banks’ debts for making bad
loans. By August 2007, the banks were on
the verge of collapse. It seemed as though
the bankruptcies of Bear Stearns, AIG,
Fannie Mae, Freddie Mac, IndyMac Bank,
and Lehman Brothers were unavoidable.
By December 2008, employment was
declining alarmingly fast.
“In ‘08, at the height of the
recession, people were really freaking out.
I heard a story on NPR about overseas
investors buying up real estate on the west
coast. They made it seem as if we were
News
going to go bankrupt and some people were
genuinely scared. But as always, America
came through and stabilized itself,” said
VPA sophomore, Liam Allen-Mcgoran
In 2009, the government launched the
economic stimulus plan. It was designed
to spend $815 billion over several years to
stimulate jobs. It was technically successful,
and in fact, it halted a four-quarter decline
in GDP by Q3 of that year, thus ending the
recession.
Although the recession has officially
ended, the unemployment rate, in Florida
it is still in the double digits and has
dramatically affected our education
system. Because of the recent recession,
the Miami-Dade school board was forced
to cut spending due to an alteration in
property tax funding.
As the recession affects the
schools, so does it affect the regular market.
Spending is down due to mistrust or
unemployment, therefore businesses have
to cut back, which equals more layoffs;
creating a spiraling effect that touches
everyone.
But things are not as bleak as they
were two years ago. The unemployment
rate has reached a near stand still, the
foreclosure rate is increasing at a slower
rate and it seems as if things are turning
around. We can finally see the light at the
end of the tunnel.
College costs rising
Students scramble as tuition climbs
MICHELLE DAVIS
Staff Writer
Seniors beware: College
tuition is rapidly increasing in
price and students and parents
are stressing about being able to
afford the costs. Starting with
the application process, college
expenses are everywhere. Without
even without getting accepted into
the university, an applicant must
pay anywhere from $30-$70 to
purchase the application. Many
times, the tuition to a University or
college is overlooked.
Students are more
concerned with actually getting
into the college and when they
are presented with the final tuition
cost, they are forced to take out
ridiculous loans that plague them
until their graduation.
Scholarships are an
essential portion of the college
application. A senior in the VPA
academy, Andrea Vanegas said
that she is a “Hispanic girl living
with a single mom and getting
good grades. If anyone is getting
a scholarship, it’s me.” Andrea
is the prime example of a good
student attempting to attend a good
university but can simply not afford
the outrageous costs of university.
She is planning to apply to as many
scholarships as possible to make
the tuition more affordable.
One example of a
university whose tuition has
drastically increased is George
Washington University in
Washington DC. The tuition from
1999-2006 increased by 52%.
This year many students
are planning to aim higher in
their academic studies so that
they can qualify for scholarships
such as Bright Futures which is a
scholarship that pays for a greater
portion of your college fees if
you’re able to maintain or reach a
GPA of 3.5.
Even if you are not a
senior, it is still good to look in to
colleges and see what you need to
do to get into the school of your
choice. The best way to keep
informed with the colleges is to log
on to their websites and go through
the requirements and also to
contact the departments and try to
set up campus tours so you can get
an idea of college life and money
management.
VPA senior, Lauren
Linares has high hopes and dreams.
But like most, she has to work twice
as hard to qualify for scholarships
and Financial Aid.
“University of Miami is
my first choice. I’m trying to get
lots of community service hours and
hopefully I can get a scholarship for
that. I really want to stay in Miami
because I want to be close to my
mom still,” said Linares.
There are a number of
ways to receive scholarships, and
there are a number of scholarships
out there that can apply to all kinds
of students. Don’t think that just
because you can’t always have the
highest GPA that you won’t be able
to achieve your goals.
Silver Knight Nominees
Representing Art is Andrea Torres,
providing extensive volunteer service to the
San Jose Protector Shelter Home, where Andrea
worked with young girls suffering from abuse
and/or rape. Intensive work to learn English
through art with these young girls helped them to
communicate without fear.
For Athletics, Jillian Roberts, as a
freshman initiated her own project “Just Shoe It.”
Inspired by her love as a cross-country athlete,
her shoe drive has collected almost 5,000 pairs of
shoes distributed to over three dozen countries.
Angela Zhou, representing the Business
category, helped to create a fashion show focusing
on recycling. Merging her successful business
talents with her creative environmental concerns
has truly impacted others.
Erika Glass is the nominee for Drama.
Active with the Community Partnership for the
Homeless, she wrote, organized, and directed
theater productions for children at the center.
“Operation Pages for Presillas” was
initiated by Alexandra Sanchez, the nominee
for English and Literature. She visited the small
impoverished village where her mother was born
and immediately wanted the children there to have
similar educational opportunities to learn as she
had. With fundraising events and the donations
of books and toys, a library was established.
General Scholarship and Catherine
Zaw are synonymous. In addition to superior
academics, Catherine’s community service
includes Connect the Americas - collecting,
programming technology, developing and
maintaining the website, and making the public
aware of this project.
Combining her love of words and art,
Emma Singer, well represents The Reef in
Journalism. She developed a guide incorporating
graphic design techniques currently utilized in
Elysium, the school’s award winning literary
magazine. Besides her love or reading she is
an avid photographer, as she is always around
campus with her camera in hand for Tsunami and
Baitline.
Brian Rodriguez represents Coral Reef
for Music. A fixture at Mercy Hospital’s Teen
and College Student Auxiliary, he is dedicated
to volunteering not only in the hospital, but to
other organizations within our community. He
has organized several talent shows held at local
theaters with proceeds going towards the purchase
of school supplies for less fortunate youngsters.
Richard Horta, is the New Media
nominee. Involvement with the Youth Ministry at
Pinelands is chronicled in documentaries of the
group’s mission trips.
Representing Science, Brooke Borgert
teaches dance and recycling to young students
in a summer camp - incorporating planning and
cutting the music, researching resources, making
costumes, and coordinating activities with the
camp staff. In addition Brooke has been actively
involved with research at the USDA.
Nicole Brandfon, nominee in Social
Science, is the founder of Wheelcharity. Out
of frustration over the lack of access for the
handicapped, she established her organization.
Through demonstrations she is bringing
awareness to assisting individuals with special
needs.
Representing Speech, Kayla Malone is
active in her Teen Youth Group by hosting statewide
conferences. As well as an active member of
several school organizations she participated in
the Florida House of Representatives and Florida
Senate Page Program; FBLA Parliamentary
Procedures State Championships; Model United
Nations; and is serving as a member of The
Children’s Trust Youth Advisory Committee.
The Reef’s nominee in the
VocationalTechnical category, Nathalie Figueroa,
initiated Kids Without Limits, giving young
children at a daycare center the opportunity to
be successful in school. Nathalie is currently the
State President of Health Occupations Students
of America (HOSA)
World Language nominee, Julian
Munoz, began his project aiding the Red Cross in
disaster relief efforts. His ability to communicate
with families whose homes have been destroyed
helped bring a sense of calm into their lives.