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In an article by the New York Times dated 30th April 2014 and entitled; “Once More, Economy Exhibits Weakness,” the main issue was on economic growth recovery. The article reported that the economy had registered yet another below per quarterly performance in the year 2014…
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Download file to see previous pages... Factors that contributed to low economic growth include slow inventory gains and abnormally cold weather experienced in the second half of the previous year. The pace of growth in domestic demand was found to be 1.5 percent in the first quarter which was slightly below what it was in the forth quarter of 2013 due to volatile factors such as trade and inventory swings. However, it is evident that fluctuations witnessed in the current times do not portray a different trend from what had been seen in the recovery process since the Great Recession. The average quarterly economic growth rate has stood at 2.2% since the year 2009.
The bleak future of economic growth is likely to impact negatively on the democrats in the forth-coming congressional elections. The prospects of the Democrats is closely tied to the voter attitudes toward the re-election bid of President Obama in which economic factors played a major role in determining the outcome. Another factor in the economic condition is on wage growth as a result of huge slack in the labor market. A report from the Bureau of Labor Statistics that was released previously on employment index indicated that the private sector wages as well as salaries during the first quarter had increased at a lower rate since 1980. The article further concurs that the recovery of the housing market were on a declining trend. This was evident on the second quarter of the 2013 in which private residential real estate investment had fallen by 0.2% of the total economic growth. Weather was found to be the main cause of decline in the recovery in the housing market.
Corporate investment in equipment witnessed a sharp reverse growth in the first quarter of 2014 compared to the growth in the fourth quarter of 2013 leading to the slackening of the overall business investment translating into 0.4 % decline in the overall economic growth. Other factors resulting in deterioration of business ...Download file to see next pagesRead More
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