Tracking the U.S Economy

Topics: Gross domestic product, Macroeconomics, Economics Pages: 14 (2702 words) Published: October 16, 2014


Tracking the U.S Economy In 2014
Emnet Idesta
Jacksonville University
Davis College of Business

ECON 201
Professor Pordeli
29 May 2014
Table Of Contents

Executive Summary...........................................................................................................3

Current State of the U.S. Economy

A.Gross Domestic Product (GDP)................................................................4

B.Foreign Trade (Exports & Imports)..........................................................6

C.Gross Private Domestic Investment..........................................................6

D. Consumer Spending ................................................................................8

E.Unemployment Rate.................................................................................8

F.Inflation Rate (CPI)...................................................................................9

G.Government Spending: Fiscal & Monetary Policies................................10
U.S. Economic Outlook: Remainder 2014.......................................................................11

U.S. Economic Personal Outlook: 2014...........................................................................12

Conclusion........................................................................................................................12

References.........................................................................................................................13

Executive Summary
The aim of this paper is twofold, to provide an in depth analysis and evaluation of the U.S economy, as determined by leading economic indicators and to provide an economic outlook for the remaining quarters of 2014. To establish a clear understanding of the current economy, our methods of analysis will utilize indicators such as the Gross Domestic Product (GDP), the unemployment rate and the Consumer Price Index (CPI). We explore in detail the components that constitute the GDP; personal consumer expenditures, government spending, gross private domestic investments and foreign trade. This will be followed by a personal economic outlook for the remainder of 2014.

Current State of U.S Economy:
A. Gross Domestic Product (GPD)

According to the figures illustrated in the above graph prepared by the Bureau of Economic Analysis (BEA), an agency of the Commerce Department, U.S. real gross domestic product contracted sharply at an annual rate of 1.0 percent in Q1 2014 compared to 2.6 percent in the previous quarter. This marked the first decline in economic growth since January 2011, a period of three years. The drop in GDP growth comes as a revision, down from the BEA's original estimate released last April which showed an increase of 0.1 percent. The BEA announces early estimates based on incomplete and partial data to provide a general picture of economic activity. These estimates are usually revised, with a second and third estimate being released as more data is acquired. The third and last revision for Q1 2014 is due to be released on June 25th and it remains to be seen how the GDP numbers will be affected.

So why did the numbers decline so drastically? Many economists blame the anemic growth due to diminished business inventories, and the abnormally, harsh winter the country experienced during the beginning of the year, however, not everyone agrees. Forbes quotes Steve Blitz, chief economist at ITG Investment Research who states, "Looking through the rest of the report, we see the cold hand of winter, although I am not sure to what extent the cold in the Midwest caused the level of exports to drop by $40.5 billion while imports only dropped $8.8 billion. Surely the supply chains weren't frozen in only one direction." Despite the historically, cold weather, there is more to the unexpected, weak performance...


References: Bureau of Economic Analysis. (2014). [Graph Illustration of Quarterly Real GDP changes 2007-2014]. Gross Domestic Product (GDP) Graph. Retrieved from
http://www.whitehouse.gov/blog/2014/05/29/second-estimate-gdp-first-quarter-2014
Bureau of Economic Analysis (2014). [Table of Revisions to Real GDP Growth 2014 Q1]. Components of Gross Domestic Product (GDP) Table. Retrieved from
http://www.whitehouse.gov/blog/2014/05/29/second-estimate-gdp-first-quarter-2014
Bureau of Labor Statistics. (2014). [Graph Illustration of CPI-U, Seasonally Adjusted, Apr 2013 - Apr 2014]. Consumer Price Index-Urban-June 2014. Retrieved from
http://www.bls.gov/news.release/pdf/cpi.pdf
Mutikani, Lucia. (2014, May 30) U.S. Consumer Spending Dips; Inflation Creeps Up. http://www.reuters.com/article/2014/05/30/us-usa-economy-idUSKBN0EA16O20140530
Congressional Budget Office
Wells Fargo Securities, LLC Economics Group. (2013). 2014 Economic Outlook; Finding Balance - 2013 Dec 11
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