American Economy essays

American Economy essays The American economy has been in a recession since March, which is troublesome. The recession was declared by the National Bureau of Economic Research, and there is pessimism as well as optimism regarding this national issue. The gloomy idea is that a recovery will not occur soon. The positive view is that revitalization in the economy will transpire promptly, yet this observation is disproven by a Federal Reserve study shows that in twelve Reserve districts the slowdowns outweigh recovery. A definite answer to predict the outcome does not exist, but there are factors of GDP, which can be observed to calculate what may happen in the American economy. These range from government spending, private investment expenditures, consumer expenditures, and net exports. Consumer spending is dropping rapidly over twenty percent yearly. During a economic boom in the 1990s, consumer expenditures reached over 1.4 trillion dollars, and is presently declining more rapidly in the National Association of Purchasing Managers price index. Technology sector purchases have deteriorated at forty percent, and low-technology acquisitions have dropped with equal misfortune. Factorial productivity has decreased for the longest phase since the 1930s. As a result, business profits have sunk up to 52 percent in the second quarter, and this is the largest drop in over two decades. Since businesses are suffering, workers are experiencing fewer benefits from Consumers work fewer hours, collect diminutive bonuses, and endure lower salaries as a result of corporate, financial weakness. The menacing fear of losing jobs prevents consumers is the largest factor which dictates end users financial activities. As companies continue to shutdown facilities and reduce the number of employees, the less the consumer is willing to spend. Unemployment rates are increasing, and will peak seven percent in the near future. Another factor ...