The Performance of the U.S. Economy Today Essay

The Performance of the U.S. Economy Today - Essay Example The main reason for the slow economic growth of the economy is lack of responsibility and initiatives taken by the government in reducing the expenditure. While considering the GDP rate of the country it is experienced that the overall economy should be rated as B grade. The rate of GDP decreased during the first quarter, it decreased to 0.2 and then it recovered in the second and the third quarter. The decrease in the oil prices facilitated the people to spend more which mainly accounts for two third of the gross domestic product. The government took initiatives in raising the GDP of the economy by reducing the total government spending which includes local, state and federal expenditure. The spending decreased from 39% to 35%.The decline in government spending led to the increase in GDP. The main reason behind grading the economy as B is that the economy is not performing effectively and efficiently, the corporations and the owners of the company or the businessman have become greedy, cautious and myopic. The investors instead of holding the cash for future they are engaged in hoarding the cash and utilizing the cash for short term profitability (Collins, 2015). The export and import function of the economy did not prosper. After the recovery of the financial crisis it is observed that the changes in case of both export and import are comparatively less. This resulted in the increase of trade deficit. The FED justified and explained that the labor and the market condition of the economy are improving as compared to the previous years. Although the number of investors increased during the period of recession but the amount of investment by the investors are decreasing with the due course of time. Therefore the level of investment failed to contribute towards the growth of the economy. The consumer spending is mainly measured in

Writer's choice Essay Example | Topics and Well Written Essays - 250 words - 28

Writer's choice - Essay Example On the other hand, if oil prices dropped and the stock prices were on the rise, then the IMF assumed an increment in oil supply. These two forces explained the plunge of oil prices (Zumbruni, Para 1-4). The results indicated that during the first phase the oil price drop was attributed by weak global demand. For instance, crude oil declined from$ 105 to around $ 82. However, in the second phase, the oil prices for the crude oil dropped further to $ 50 and IMF suggests that a decrease in the oil price was due to increased demand. The estimates reveal that supply outdid the demand during this phase (Zumbruni, Para 1-4). The explanation aligns with the class materials effectively as it explains the effect of reduced demand and increased supply on prices. Accordingly, a decrease exerts a downward pressure in the short-run. Apparently, increased supply allows a surplus of the commodity in the market, therefore, exerting a downward pressure on the price levels. These aspects are reflected in chapter four that focused on demand and supply within the oil markets. The above information may be illustrated as follows; Zumbruni, Josh. Supply of Demand? The IMFBreaks Down the Collapse of Oil Price. Wall Street Journal. Real Time Economics. April 14, 2015. Retrieved from