US (United States) Economy

The US recession period of darkness is well marked by a dramatic slowdown in economic activity as well as by rising unemployment, additional declines in US Stock prices, and constant volatility. US Government has initiated many recovery plans and it is expected that US economy will be back on track slowly but steadily.

Economy Strength:

The strength of US economy has been weakened by mounting recession pressure and shaky financial market. The graveness of such troubles continues to effect the current established financial institution to such an extent that it might be quiet and completely lost before the tide turns.

It is still purchasing the troubled assets to make an attempt to fix the download spiral of the US economy, but it is not sure that this strategy will work and is going to be successful. Many individuals are still wondering if US economy will rebound again and will gain back its strength. Certain signs can be seen that US economy has retained strength in some areas. According to US Treasury, US exports have grown over the last few quarters; it was marked up to 11% in the global market. The recent figures given by US Treasury shows that the consumer price index had risen around 2.5% over the past twelve months, only if we exclude the cost of energy and food. Unfortunately it has shown no strength in the case of employment, the number of paid workers has been decreasing since the financial crisis has begun.

Emergency Economic Stabilization Act of 2008:

The primary goal of this act is to infuse sufficient capital into the troubled financial institution so that they rebound effectively which proves more than enough to circumvent the downward spiral that is currently prevailing in the economic situation. The main intention of the act is to provide a temporary boost that will in turn help the economy to navigate around in the housing market. At this point the shares of the American companies are at low levels but they are generating gains that will make it into a whole and they will rise again. US strategy is to provide the much wanted strength and provide a cushion to negative financial situation.

The US Government is trying its level best to overcome the financial shock. At this point the shares of the American companies are at low levels but they are generating gains that will make it into a whole and they will rise again.

A Market Mandela:

Analyzing US economy also calls for a look upon the Market Mandela which is a cross map of human perspective. The analysis of the big picture begins at the center and embarks outward. While the center of the US economy is the credit, the credit crisis has shaken the entire economic complex Mandela. And the economic has transformed into chaos. Due to lacks of transparency into the financial report of banks & financial institution and relying on borrowers face value rather than credit score, the US household and business market was impacted. With recession at its full swing Banks and Financial institutions were sitting on cash and running away from granting credit. The borrowers also did not want to burden themselves with additional loan. Above everything, an investigated story recently clarified that instead of the tax payer providing infusion, the bank is using the money to finance the take over deals.

Whether or not US Economy is into recession, the nonprofit-economic research group has stated five points for its research study:

  • Gross Domestic Product
  • Industrial Production
  • Employment
  • Income
  • Retails Sales

The five points predicted by the research group gives a detail analysis:

Gross Domestic Products:

The US Economy is measured by GDP, it rose by 0.9% in the first quarter, the second advanced an estimate by 2.8% but the third quarter declined by 0.3%. The last yearly GDP posted by the research group said that the economy declined by 0.2%, this gives a verdict of recession.

Industrial Production:

It measures the output by the nation's factories, which dropped by 2.8% recently, thus, giving the conclusion of recession.

Employment:

The unemployment rate has increased since 2001; it was estimated around 6.5% which was double of than what was expected. And it has been increasing since the last 14 years. Thus, it gives the verdict of recession.

USA Income & US Economy

Personal income increased at the rate of 0.2%, but the personal consumption decreased 0.3%. If we exclude the rebate payments made by the US taxpayer, increased by 0.3%; thus, we cannot conclude that whether US Economy is in recession or not.

Retails Sales: US Economy

October retail sales are coming in, well below already diminished expectations, and some reports have been downright depressing - including The Neiman Marcus Group Inc. -26.8%; The Gap Inc. (GPS) -16%; The Nordstrom Group (JWN) -15.7%; J.C. Penny Co. Inc. (JCP) -13%; Kohl’s Corp. (KSS) -9%; Ltd. Brands Inc. (LTD) -9%; Target Corp. Inc. (TGT) -4.8%; and Wal-Mart Stores Inc. (WMT) +2.4%.