What is the current macroeconomic situation in the US. Is the United States's economy currently concerned about unemployment, infalation, recession. What fiscal policies and monetary policies would be appropriate at this time - Essay Example

Running head: Macroeconomic Situation in the US Current Macroeconomic Situation in the US Insert Insert Grade Insert 06 June2012 What is the current macro-economic situation in the United States? The current macro-economic situation in the United States is in a state of hang-over position and, therefore, it is premature to state that the recession of 2008 is over. Presently in the US, there is slow growth and escalating unemployment; the main sources of apprehension. However, the FED will maintain the funding rate pending 2014, which is a giant push.

It forecasted that the economy will develop more than 2% the following year, which is good news. The currency has not changed much in comparison to the Yen (OECD Publishing, 2012). The economic meltdown of 2008 greatly affected the prospects of the US economy and still hangs over the current economic situation. As a result, the current macroeconomic situation appropriately echoes the 2008 economic crisis in a highly significant manner. First is the aspect of slow growth where the American economy has been lethargic ever since the economy collapsed in 2008.

Slow economic growth is currently prevailing in the United States, and economic development is occurring at a dawdling pace. It is estimated that the economy will grow at the rate of 2% through 2014. This is an indication that the economy will take more time to recover fully. Other predicaments affecting the economy of the United States include unemployment, inflation, and recession. Unemployment is at a very high level and is mainly caused by slow growth of the economy. As the economy takes more time to grow there are very few opportunities for employment, making it difficult to end the current problem of unemployment.

Inflation is also a major problem affecting the US economy, which involves the incessant rise of prices of commodities. Inflation has partly been contributed by the current spate of economic stimulus programs, which have pumped a lot of funds into the economy with the aim of stimulating growth and creating job opportunities. Is the U.S. economy currently concerned about unemployment, inflation, and recession? The US economy is presently concerned about unemployment, inflation, and recession.

These have been the principal factors affecting the economy ever since the 2008 economic meltdown (Leboeuf, 2012). The administration has injected trillions of money into the economy to stop the recession. There has been debate over the effectiveness of this strategy as to whether it will create inflation. At this position in time, America is experiencing age of "severity" an era of recession worst from the time of the "immense depression." In essence, recession is nastiest than inflation during this point of economy.

Inflation and greed is an excellent thing for the economy to generate jobs to progress the economy when the economy is in a slump. Mr. Friedman counsel has stood the experiment of time with numerous Presidents inquiring about suggestions from him. America requires some type of "inflation" to provide the economy the thrust it need at this instance, certain the interest rates are low down, but Americans do not have the required assurance to either endow or spend to provide the economy the further it needs.

America requires assurance at this time to twist the economy around. Americans as well need employments maybe the imminent election will modify the image we have at this occasion, numerous people are hoping. The US economy is primarily concerned about unemployment, which is a serious headache in the United States today. Slow economic growth is the chief reason for high unemployment cases. The US economic development has been very sluggish right from 2008 when the economy slipped. Job creation has been remarkably low in the United States creating a large population of individuals without jobs.

Apart from concern over unemployment, the US economy is equally apprehensive about recession and inflation which as well have exerted a lot of pressure on the economy of the country. What fiscal policies and monetary policies would be appropriate at this time in the US? The economic revival that started in the center of 2009 emerges to have reinforced in the precedent few months, while the unemployment charge remains soaring. The first phase of the revival, which happened in the subsequent half of 2009 as well as in early 2010, was in considerable part due to the stabilization of the monetary system, the results of expansionary financial and fiscal policies, along with the strong enhancement to production from commercial entities rebuilding their exhausted inventories.

This occurred although economic development slowed last spring and apprehensions about the robustness of the revival intensified as the impulsion from account building as well as fiscal stimulus lessened and as Europes fiscal plus banking predicaments roiled comprehensive financial markets. More recently, nevertheless, there has been increased confirmation that a self-supporting recovery in the purchaser and business expenditure may be prevailing. Conspicuously, real purchaser spending ascended at a yearly rate of above 4 percent in the fourth quarter.

While, strong sales of auto mobiles accounted for a considerable portion of this hoist, the recent achievements in consumer expenditure appear rationally broad founded. Business investments in new equipment and software increased vigorously throughout much of 2011. Building remains weak, although, reflecting a projection of vacant moreover foreclosed homes along with unrelenting poor fundamentals for nearly all types of marketable real estate. Overall, enhancing household and commercial confidence, accommodative economic policy, and more-helpful financial forms, including an, in fact, increasing enthusiasm of banks to loan, seem probable to result in an additional rapid pace of economic revival in 2011 than perceived last year.

In summary, the current macro economic situation of the United States economy is reflective of the 2008 recession, which has not yet ended. The US economy is yet to fully recover from the 2008 economic meltdown. This is indicated by slow economic growth, recession, inflation, and unemployment; these factors are the key pointers to the inherent weaknesses in the American economy. Currently, the American economy is stilling reeling in recession as a result of the 2008 economic crisis and it will take more time to stabilize and regain its normal growth momentum.

References Leboeuf, R. (2012). A Voters Guide to the US Economy-2012. Washington: CreateSpace. OECD Publishing. (2012). OECD Economic Outlook, Volume 2011, Issue 2. New York: OECD Publishing.