US Economy Essay

Length: 2 pages Sources: 2 Subject: Economics Type: Essay Paper: #23079199 Related Topics: Unemployment, Fiscal Policy, Unemployment Rate, Economy
Excerpt from Essay :

Macro

The current state of the economy in the U.S. is generally favorable. Looking at the major macroeconomic variables, they are all at reasonable levels and more important they are trending in the right direction. This paper will look at critical variables such as the GDP, unemployment, inflation and interest rates.

The GDP is currently growing at 3.9% for the third quarter of 2014, after a 4.6% increase in the second quarter (BEA, 2014). This is healthy GDP growth. Over the past several years, the economy has been growing at a slower rate, during what was a sluggish recovery from the recession in 2009. But the current levels show that the GDP is finally getting to the point where it has recovered almost entirely, and growth is picking up. This is a positive trend in the economy. This means that the GDP will continue to grow. Right now, monetary policy is expansionary, so if that eases up, then the GDP growth might slow a little bit. But if monetary policy remains unchanged these high GDP growth rates should continue, especially given the lower fuel costs we are...

...

The unemployment rate spiked in October 2009, so five years ago, and has been falling ever since. The unemployment rate lags behind other indicators. The current unemployment rate is 5.8%. This is the lowest level since July 2008 (BLS, 2014). It is worth considering that the rate is continuing to fall, as the trend has been ongoing for the past five years. The unemployment improvement should continue for another year at least until it hits the normal level in the 4.4-4.5% range.

The third metric is the inflation rate. The Federal Reserve tries to manage inflation and wants to maintain an inflation rate of 2% per annum. This rate will allow for some returns for investors -- deflation is bad for investments -- but it will not allow the erosion of real wages too quickly. Wages are sticky, so a lower rate of inflation gives employers time to keep wages up-to-date with the cost of living. The current inflation rate is 1.7%, in October 2014 (BLS, 2014). This rate of inflation is lower than the target inflation rate, despite the fact that the GDP is increasing. This might have something to do with the decline in…

Sources Used in Documents:

References

BEA. (2014) Gross domestic product. Bureau of Economic Analysis. Retrieved December 3, 2014 from http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

BLS. (2014). Labor force statistics from the current population survey. Bureau of Labor Statistics. Retrieved December 3, 2014 from http://data.bls.gov/timeseries/LNS14

BLS. (2014). Consumer price index. Bureau of Labor Statistics. Retrieved December 3, 2014 from http://www.bls.gov/news.release/cpi.nr0.htm

Federal Reserve Bank of New York. (2014). Federal funds data. Federal Reserve Bank of New York. Retrieved December 3, 2014 from http://www.newyorkfed.org/markets/omo/dmm/fedfundsdata.cfm


Cite this Document:

"US Economy" (2014, December 03) Retrieved January 26, 2022, from
https://www.paperdue.com/essay/us-economy-2154425

"US Economy" 03 December 2014. Web.26 January. 2022. <
https://www.paperdue.com/essay/us-economy-2154425>

"US Economy", 03 December 2014, Accessed.26 January. 2022,
https://www.paperdue.com/essay/us-economy-2154425

Related Documents
Economy of China
Words: 2343 Length: 6 Pages Topic: Economics Paper #: 90003484

Economy of china is one of the largest economies in the world after the United States of America. Over the years it has been regarded as the fastest growing economy in the world registering the highest number of exports and imports. This has been attributed to high population that the economy has to support. As a result, the economy has improved which has been reflected in terms of the infrastructure

Economy of the BRIC Countries
Words: 2753 Length: 10 Pages Topic: Economics Paper #: 6606891

Banks in India are required to provide 40% of their net credit to other sectors like agriculture, retail trade, small scale industries and business.Net assets of the banking sector are held by private banks which holds 18.2%, 75% by public sector banks while the 6.5% are held by foreign banks. China China is the largest economic powerhouse of the BRIC countries by both population wise and GDP. It had an estimated

Economies Planned and Unplanned Economies
Words: 647 Length: 2 Pages Topic: Economics Paper #: 70557501

These convergences lead to mixed economies. Globalization and the U.S. Economy Outsourcing is a result of the current globalization rate, due to rise of internet users and communication through broadband. In actual sense, outsourcing is inevitable, and no one is going to eliminate it any time soon, including the United States. However, outsourcing will mean loss of jobs in the United States, leading to a position where these jobs need to

Economy Based on the Information Provided by
Words: 1030 Length: 4 Pages Topic: Economics Paper #: 49257317

Economy Based on the information provided by the St. Louis Fed, the GDP indicators for the U.S. are as follows. The real GDP growth is at 3%. The trend for this indicator is upward, as it has increased steadily over the past four quarters. Real GDP growth was on a downward slide for all of 2010, however, bringing it to a very low level at the end of the year, which

Economy Has Been Showing Slow, but Steady
Words: 1336 Length: 4 Pages Topic: Economics Paper #: 76954209

Economy has been showing slow, but steady improvement. I expect that it will continue on this pace for the next three quarters as a result of projects that have been made for the unemployment rates, GDP growth, and inflation. The rate of unemployment has steadily decreased with the rate being 8.2% for March 2012, which was a minor increase over February's rate of 8.3%. The rate in November had been

Economy of the 21st Century Represents an
Words: 957 Length: 3 Pages Topic: Business - Management Paper #: 61891853

Economy of the 21st century represents an economy which has undergone a complete metamorphosis from the old techniques of doing business to a completely new dynamic ways of conducting business which has largely been influenced by the increased technological advancement among the nations and the interconnections of the global markets. The transformation of the economies have been driven by the global shifts in consumptions, investments, savings, competition, political and environmental