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This marked the fifteenth consecutive month of factory job losses.
In a "normal" recession, recovery begins as cuts in interest rates that induce increased consumption spending. This, in turn, leads to increased production to meet demand and eventually to increased capital spending. However, in the recession of 2001-2002, consumption spending did not fall because it was sustained by the cuts in interest rates carried out by the Federal Reserve Board over the previous 2 years. The only real basis for a recovery is an increase in business capital spending and it is here that some of the intractable problems of the United States economy are most clearly seen. Interest rate cuts have little or no impact here because the major problem confronting business is not lack of credit but lack of profitable opportunities.
Pre-tax profits as a share of business product for the non-financial corporate sector rose to 8.7% in the first quarter of 2003 against the low of 7.2% in...
This rise, however, was still well below the peak of 12.8% reached in the third quarter of 1997 and almost 1.5% below the post-1970 10.1% average (Tieman, 2001). The economic problems generated by lower profit rates are compounded by the fact that lower interest rates and higher budget deficits, both of which tend to stimulate economic growth, are having increasingly less impact.
The other major factor which may push interest rates up is the worsening United States balance of payments deficit, now running at around $500 billion. If for any reason investment inflows into the United States falter, then interest rates would be forced up, possibly setting off a deep-going recession in the United States and global economy. Compared to other post-war recessions, the downturn of 2001 was one of the shallowest on record. However, viewed within the wider context of the deep-going structural imbalances within the United States economy, it was viewed…
Reference
Tieman, J. (2001). Recession? What recession? Healthcare industry again shows its natural resistance to economic ills. Mod Healthc, 31(50), 38-40.
Economics: The State of the U.S. Economy Cousin Edgar, a global investor, is seeking to capitalize on the thriving gasoline industry and the rising world demand for oil by purchasing several gas stations in the U.S. market. Inspiring his interest is the high price of gasoline, which he reckons will rise even higher in the near future, thanks to the urbanization and industrialization currently being witnessed in the developing economies of
"This is the first time since March 2001 that Pennsylvania's job count climbed above 5.7 million," Schmerin announced. "Our economy has added 60,000 jobs in the last year and I expect that trend will continue. Pennsylvania's economy added jobs in nine of the past 10 months." The tables below show the current state of the U.S. economy and the Pennsylvania labor-related economy. Table 1: United States Economy at a Glance Footnotes: (1) In
economy in the United States and the catastrophic terrorist attacks of September 11th is often discussed, for many reasons. The events were so integral to the United States as a historically devastating occurrence that emotionally, socially and psychologically changed the face of the nation and with that nation is the integral issue of economy. This work will analyze the difference between the economic after effects of the September 11th
Trade between the United States and Japan [...] trade between the United States and Japan, such as exports and imports of goods, exports and imports of services, tourism, and investments. Japan and the United States are two of the premier forces in trade around the world. The two countries depend heavily on each other in a variety of trade areas, from electronics to tourism and banking. Together, they form
Less Economic Integration Within the United States Over the last several decades, the total amount of trade between the United States and Canada has been increasingly brought to the forefront. Part of the reason for this, is because the two nations share a common boarder that has encouraged both of them to trade more with each other. As time has evolved, this relationship has continued to increase exponentially with the two
08% 2.42% 2.78% 2.57% 2.69% 2.69% 2.54% 2006 3.99% 3.60% 3.36% 3.55% 4.17% 4.32% 4.15% 3.82% 2.06% 1.31% 1.97% 2.54% 3.24% 2005 2.97% 3.01% 3.15% 3.51% 2.80% 2.53% 3.17% 3.64% 4.69% 4.35% 3.46% 3.42% 3.39% Trade deficit The United States trade balance has been showing deficit since the 1970s, but the rapid growth of trade deficit started in 1997. The highest record of trade deficit was marked last year, as deficit of