America's Economy Today
With all the bad publicity about the economy nowadays anyone with access to a TV, magazine, or newspaper should be somewhat familiar with the current economic crisis here in America. It seems like the Dow Jones Industrial Index and the S&P 500 Index are dropping lower every day, not to mention the poor condition of tech stocks listed in Nasdaq. Here's some current stock market figures that display the markets current deterioration: The Nasdaq index lost 8 percent of its value, putting it nearly two thirds off its peak last year, the Dow Jones index closed below 10,000, ending its biggest one-week point drop in 11 years, the S&P 500 index is now down 25% from its peak last March. This marks the start of the first bear market in half a generation.
The future certainly looks grim just by looking at the major index's performance, but that is not the only thing we have to worry about. Consumer spending fuels two thirds of the economy and consumer confidence fuels consumer spending. So far this year, consumer confidence has been dropping drastically. People have still been spending at about an average rate, but as the market continues this downward spiral people will definitely begin to hold onto their money a little tighter.
Everyone knows about the big tax cut George Bush is promising us, but how much will it really help the economy? The Bush administration says they are going to cut back $1.6 trillion dollars of taxes we pay over a 10-year period of time. One major problem with this is that only $6 billion will be cut the first year, when we are in need of a major tax cut immediately. Besides that, the majority of the cut will be given to the wealthy, which are way less likely to increase spending, whereas the middle class certainly would when their incomes are increased. Some moderate democrats have proposed that it may take a healthy $125-$160 billion to spark a turnaround in the economy. Bush says that cutting the top tax rate...
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