Us Economy Research Paper

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The current state of the economy in the United States has been slow in recent months. While the economy is not currently in a recession, we may eventually fall victim to the first recession we've had in nearly ten years. The economy in general is showing growth, just not much. It will be difficult to predict what exactly will happen to the US economy in the future. Many economists do not agree on what will become of the economy. Some feel that we will begin a recession over the next year, and some feel that there is significant policy implementation that will allow us to dodge a recession and regain our economic strength. There are many factors that make up the US economy. The means in which I will discuss
The effect that the lowering of interest rates has on the economy is due to the theory that if interest rates decrease then the supply of loanable funds will increase. Therefore the consumers will have access to more loanable funds and will be able to consume more goods. Also people will be more inclined to borrow money because they won't have to pay such high interest rates. Many economists believe that simply reducing the interest rates will stimulate the economy into periods of more rapid growth. Two economists William McDonough the President of the New York Fed, and the President of the Chicago Fed Michael Moskow are cautiously optimistic about the future of the economy. They think that after one or two quarters of sluggish economic progress, the economy will then regain its strength. They are reluctant to say that there will be no recession at all, however they feel that the growth of the economy in the first quarter of this year will be weak, but they think it will still remain positive. They also noted that the biggest problem would not be increasing inflation, but weakness of market due to low consumer expectations. President Bush has also proposed a series of fiscal policy changes that will help to
While cutting taxes, President Bush also plans to increase government spending, but with controls and limitations on congressional spending. He plans on raising funds in defense, education, as well as other areas. By doing so, President Bush is attempting to effectively use supply-side economics tactics. President Reagan also attempted supply-side economics in the 1980's, but he was unable to keep the deficit from skyrocketing because the spending restraints on congress never materialized. If the rate of domestic spending had risen at the same rate as inflation, at the end of his presidency, the government would have had a surplus of almost 250 billion dollars. The way that supply-side economics works is by increasing the disposable income of the taxpayer, which will inevitably increase consumption. The theory is that if people get to retain more of the money that they earn they will work better and longer thus increasing productivity as well as the quality of goods. President Bush's tax cut plan if done correctly will help greatly to get the US economy to increase its growth. So is the United States in a recession? The answer is no it isn't. The US has had a period of sluggish