The Macroeconomic Situation In The United States Of America - Essay Example

Macroeconomic Situation The macroeconomic situation in the United s of America could be described as ailing and this is due to the fact that the economy of the country is just recovering from an economic recession. The global economic meltdown that hit the world did not leave out the United States of America as the macroeconomic situation in the country is such that the government is trying to recover from the economic recession and inflation that has hit the country (Jones, 2008). The country is facing issues with the unstable price of oil in the global market and this has also made the prices of commodity unstable and the level of inflation in the country is rather alarming (Jones, 2008).

Thus, the current macroeconomic situation in the country is such that the citizens are faced with the instability of the price of commodity in the market. There are also issues with an absurd increase in the interest rate which has discouraged prospective investors from borrowing money from financial homes. The macroeconomic situation in the country has actually put the US Congress and the Federal Reserve on their toes. There are different things that can be done to salvage the macroeconomic situation in the US.

The monetary policies in the country should be tightened through the use of expansionary fiscal policies that would help the country to fully recover from the economic recession that it is faced with. The problem of inflation could also be dealt with by making the aggregate demand lower than the production capability of the economy. The responsibility of tackling the problems of inflation in the country actually lies on the shoulders of the Federal Open Market Committee (FOMC) (United Nations, 2010).

The FOMC should adjust the federal funds rate in order to meet up with the macroeconomic situation in the country. The US Congress should also try to approve economic stimulus packages for taxpayers as this would help to solve the economic problems in the country. Assets that can be converted to money should also be provided by the Federal Reserve and interest rates should be reduced to the barest minimum in order to encourage investments in the country (United Nations, 2010). References Jones, C.I. (2008).

A Supplement to Macroeconomics. Department of Economics, U.C. Berkeley: W.W. Norton United Nations. (2010). World Economic Situation and Prospects 2011. New York: Department of Economic and Social Affairs, UN.