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State of the economic essay
This essay will be demonstrating the overall understanding of economic statistics and this also aims to carry an analysis of the current data concerning the health of the United States.
Introduction
The statistical study in the economic activity is termed as the economic indicators which include the analysis of economic performances and predictions about future performances and outcomes. Several indices are included as economic indicators such as earning reports, and summaries written for different economies. The economic indicator is data based on the macroeconomic scale which is used for the interpretation of current and future possibilities of investments by the analysists. The economy may be also analyzed and judged with the help of economic indicators. While these indicators may be set according to the investor's choices. The data of the economic indicators are widely followed by the government and non-governmental organizations. These are released according to a period that allows investors to prepare a final plan and to collect certain information. There are certain indicators of economics which include a leading indicator, lagged indicator, and contemporaneous or coincident indicator. Leading indicators are supposed to change the economic conditions before the economy changes, while this helps the policymakers to observe and assume the expected changes in the economy. Lagged indicators occur after the happening of a shift in a particular target variable. This may be defined as that indicator which is meant to confirm a pattern that is still in the process. While the coincident indicators occur at the exact time and this helps to clear an understanding of the economic state. The business cycle depends upon the rise and fall in the production of material goods and services delivery in a particular economy. Different stages in the business cycle include peak, recessions, depression and trough and recovery. The growth of the economy depends on the expansion while the economy declines because of the recession. Proceeding the discussion with the business cycle of the United States economy business cycle, the economic growth of the US started expanding during the era of industrialization. The US has the National Bureau of Economic Research which determines the yearly dates of the business cycle. This includes the production from industries, employment rates and income of people.
Phases in the business cycle
There is a total of four stages in the business cycle which include peak, expansion, contraction, and trough. The first stage of the business cycle is the expansion which is characterized by the continuous increase in employment, economic growth, and an increase in the prices due to upward pressure. The peak is considered to be the highest peak during which the economy can produce maximum output, employment opportunities or full employment opportunities and this also introduces permissible inflationary pressures on the market prices. The third one is the contraction, in which the economic growth contracts employment opportunities decreases and the pressures on the prices subside. While the lowest stage at which economy hits the bottom and after this the next phase may be a contraction or expansion.
The United States is in the phase of expansion because the employment opportunities are increasing and the economic growth is also rising upwards. The economy of the United States will increase when it will allow other regions to start a trade to the area because this will increase the inflow of the economic sources. More economies with invest in the economies of the United States, than there will be more economic growth. The last trough in which the United States was during 2009, this was the peak-trough but after this year the business cycle moved towards the expansion ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"fLBqluiW","properties":{"formattedCitation":"({\\i{}US Business Cycle})","plainCitation":"(US Business Cycle)","noteIndex":0},"citationItems":[{"id":1206,"uris":["http://zotero.org/users/local/F0XOCTdk/items/C4CURUJW"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/C4CURUJW"],"itemData":{"id":1206,"type":"webpage","URL":"https://www.nber.org/cycles/cyclesmain.html","shortTitle":"US Business Cycle","accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (US Business Cycle).
Gross Domestic Product
Gross Domestic Product helps to measure the final values of goods and services that are produced within the boundaries of countries and states. This measures the output of the economy and this is also considered as the measurement of the total size of an economy. The economy of the United States is expanding, so this can be assumed that the GDP rate would be higher for the United States. However, the Gross Domestic Product of the United States during the half of the quarter of this present year is $5, 385,526 million. The rate of GDP is 2.1 percent, while it was 2.9 percent during 2018.
Inflation
Inflation is measured by the economists with the formula which is
Inflation= [Price(year 2) - Price(year 1)/Price (year 1)]*100.
The Consumer Price Index in recent years has increased and the inflation rate of the United States. Several people are affected due to higher-costs of living. People living in the United States are largely impacted by the changes in the CPI, however, they can use the CPI index to adjust their payments and prices ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"pmrVD3N8","properties":{"formattedCitation":"({\\i{}Consumer})","plainCitation":"(Consumer)","noteIndex":0},"citationItems":[{"id":1212,"uris":["http://zotero.org/users/local/F0XOCTdk/items/PEJI3SZU"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/PEJI3SZU"],"itemData":{"id":1212,"type":"webpage","title":"Consumer : U.S. Bureau of Labor Statistics","abstract":"Consumer","URL":"https://www.bls.gov/audience/consumers.htm","shortTitle":"Consumer","language":"en-us","accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (Consumer). The CPI for urban consumers has increased to 0.3 percent during the seasons while the yearly percentage is 2.1. The latest news about CPI in the United States is that the economy is narrowing down the tensions regarding trade and recession, however, the largest gain of the year for CPI was 0.4 percent ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"30V083Ag","properties":{"formattedCitation":"(\\uc0\\u8220{}US Consumer Prices Increase More than Expected in October\\uc0\\u8221{})","plainCitation":"(“US Consumer Prices Increase More than Expected in October”)","noteIndex":0},"citationItems":[{"id":1214,"uris":["http://zotero.org/users/local/F0XOCTdk/items/VFZ7LUHW"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/VFZ7LUHW"],"itemData":{"id":1214,"type":"webpage","title":"US consumer prices increase more than expected in October","container-title":"CNBC","abstract":"The Labor Department said on Wednesday its consumer price index increased 0.4% last month as households paid more for energy products, healthcare, food and a range of other goods. That was the largest gain in the CPI since March and followed an unchanged reading in September.","URL":"https://www.cnbc.com/2019/11/13/us-consumer-prices-rise-0point4percent-in-october-slightly-higher-than-estimates.html","language":"en","issued":{"date-parts":[["2019",11,13]]},"accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (“US Consumer Prices Increase More than Expected in October”).
Unemployment
Unemployment is measured by unemployed individuals/ the total number of employed persons. It is not a perfect measure for joblessness because it does not include the daily based workers, it only includes those who work on larger scales. The unemployment rate of the United States is 3.6 percent, this rate is changed a little to 3.5 percent ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"Pz0usavT","properties":{"formattedCitation":"({\\i{}Unemployment})","plainCitation":"(Unemployment)","noteIndex":0},"citationItems":[{"id":1224,"uris":["http://zotero.org/users/local/F0XOCTdk/items/R84ES3NS"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/R84ES3NS"],"itemData":{"id":1224,"type":"webpage","title":"Employment, Hours, and Earnings from the Current Employment Statistics survey (National) Home Page","URL":"https://www.bls.gov/ces/","shortTitle":"Unemployment","language":"en-us","accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (Unemployment). This has decreased because of more employment opportunities and earning sources in the market.
Monetary policy
In every country, there is a monetary authority that controls the interest rates on each borrowing and supply of money by the country, while this mainly targets inflation. The monetary policy is measured by the central bank and it takes action. The Federal Open Market Committee shows they the market and economic activities have been raised ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"uhDg05ty","properties":{"formattedCitation":"(\\uc0\\u8220{}Federal Reserve Issues FOMC Statement\\uc0\\u8221{})","plainCitation":"(“Federal Reserve Issues FOMC Statement”)","noteIndex":0},"citationItems":[{"id":1216,"uris":["http://zotero.org/users/local/F0XOCTdk/items/G82W76QX"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/G82W76QX"],"itemData":{"id":1216,"type":"webpage","title":"Federal Reserve issues FOMC statement","container-title":"Board of Governors of the Federal Reserve System","abstract":"Information received since the Federal Open Market Committee met in October indicates that the labor market remains strong and that economic activity has been","URL":"https://www.federalreserve.gov/newsevents/pressreleases/monetary20191211a.htm","language":"en","accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (“Federal Reserve Issues FOMC Statement”). This is caused due to an increase in the number of employment opportunities.
Fiscal policy
Fiscal policy is the adjustments in the spending levels of the nation and adjustments in the tax rates so that the economy of the nation may be monitored. The current state of the United States Congress in terms of policy has adopted the contractionary fiscal policy. The US has limited the number of imports and other economic investments. The state is making changes within the country. The budget of the US may be impacted by the presidential budget while it is expected that the administrative proposals may have major impacts such as the budget deficit would be estimated as $1.5 trillion ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"6RiLicT5","properties":{"formattedCitation":"({\\i{}President\\uc0\\u8217{}s Budget})","plainCitation":"(President’s Budget)","noteIndex":0},"citationItems":[{"id":1222,"uris":["http://zotero.org/users/local/F0XOCTdk/items/P9DEGIDC"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/P9DEGIDC"],"itemData":{"id":1222,"type":"webpage","title":"An Analysis of the President’s 2020 Budget | Congressional Budget Office","URL":"https://www.cbo.gov/publication/55195","shortTitle":"President's Budget","issued":{"date-parts":[["2019"]]},"accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (President’s Budget).
International trade
International trade is referred to as the exchange of capital, and services beyond borders. The United States of America is engaged in several international trades with a majority of countries in the world. The US is well aware of the importance of international trade in the provision of employment and in raising living standards ADDIN ZOTERO_ITEM CSL_CITATION {"citationID":"4F8RQDE0","properties":{"formattedCitation":"({\\i{}OEC - United States (USA) Exports, Imports, and Trade Partners})","plainCitation":"(OEC - United States (USA) Exports, Imports, and Trade Partners)","noteIndex":0},"citationItems":[{"id":1220,"uris":["http://zotero.org/users/local/F0XOCTdk/items/4JPE9TPN"],"uri":["http://zotero.org/users/local/F0XOCTdk/items/4JPE9TPN"],"itemData":{"id":1220,"type":"webpage","title":"OEC - United States (USA) Exports, Imports, and Trade Partners","URL":"https://oec.world/en/profile/country/usa/","language":"en","accessed":{"date-parts":[["2019",12,17]]}}}],"schema":"https://github.com/citation-style-language/schema/raw/master/csl-citation.json"} (OEC - United States (USA) Exports, Imports, and Trade Partners). The US has to adopt new policies to expand its economy by starting new trading destinations all over the world, it should not adopt the protectionist approaches because the economy will not grow in the international market. It has to initiate trading policies with other countries and this will make a positive impact on the nation of America. Because they may also be able to earn and get employment opportunities and improve their living standards. The neighboring countries and other countries from all over the world may be able to find a better lifestyle. The United States should start with developing countries which are in a phase of making investments to develop their economies.
Conclusion
The economy of the United States is expanding because of the creation of employment opportunities within the state, people have become more employed and they have started earning more. The United States has to increase future trades shortly, so that, it may be able to expand its economy on the international market. In these recent years, the economy of the United States has increased and it has shifted from trough to expansionary business cycle, which is a positive aspect.
Works Cited
ADDIN ZOTERO_BIBL {"uncited":[],"omitted":[],"custom":[]} CSL_BIBLIOGRAPHY An Analysis of the President’s 2020 Budget | Congressional Budget Office. 2019, https://www.cbo.gov/publication/55195.
Consumer : U.S. Bureau of Labor Statistics. https://www.bls.gov/audience/consumers.htm. Accessed 17 Dec. 2019.
Employment, Hours, and Earnings from the Current Employment Statistics Survey (National) Home Page. https://www.bls.gov/ces/. Accessed 17 Dec. 2019.
“Federal Reserve Issues FOMC Statement.” Board of Governors of the Federal Reserve System, https://www.federalreserve.gov/newsevents/pressreleases/monetary20191211a.htm. Accessed 17 Dec. 2019.
OEC - United States (USA) Exports, Imports, and Trade Partners. https://oec.world/en/profile/country/usa/. Accessed 17 Dec. 2019.
“US Consumer Prices Increase More than Expected in October.” CNBC, 13 Nov. 2019, https://www.cnbc.com/2019/11/13/us-consumer-prices-rise-0point4percent-in-october-slightly-higher-than-estimates.html.
https://www.nber.org/cycles/cyclesmain.html. Accessed 17 Dec. 2019.
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