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Surviving the lastest recession of Sept 11. The US economy is on the verge
of dealing with its tenth recession since World War II. ...
Is America going into a recession? Is America going into a recession? Well
first what exactly is a recession? In its simplest form ...
Recession. Today more than ever, there is a major and constant fear of an
impending recession in our government’s economy. A recession ...
Recession. ... This in itself, defines a recession, but there is much more
information to confirm that the US is headed for a recession. ...
uk recession possibility. recession is a period of negative economic growth
for 2 consecutive economic quarters. ... Thus starting a recession.
Submitted by DAUC on April 21, 2008
Category: Social Issues
Words: 1440 | Pages: 6
Views: 139
Popularity Rank: 81,542
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U.S. Economy May Slip Into a Recession
The latest remarks from Ben Bernanke revealed his beliefs that the U.S. economy would have little, if any, real gross domestic product growth for the first two quarters of 2008. Bernanke goes on to say that RGDP could even “contract slightly”. This in itself, defines a recession, but there is much more information to confirm that the U.S. is headed for a recession.
One of the first indicators of a looming recession is the decline in homebuilding, employment, and consumer spending. These characteristics are certainly representative of a bust, affecting consumption in the expenditure approach. Another good indicator is that orders to U.S. factories “fell more than forecast” (Lanman). This shows that the economy did not correctly account for the reduction of exports, which also affects the expenditure approach. Finally, according to the article, the economy was said to have grown .6% in the last quarter of 2007, and then only .2% in the first quarter this year, both of these being Nominal GDP. Now according to the Fed, the inflation rate has “increased at least two percent from the year earlier” (Lanman). This would make the Real GDP -1.4% for the last quarter of 2007 and -1.8% for the first quarter of 2008, or a decreasing RGDP, for two consecutive quarters, meaning the U.S. has been, and currently is, in a recession.
So the economy is certainly “going through a very difficult period” as Ben Bernanke stated, and he thinks that if he can stimulate the economy, he can raise the RGDP, bringing the economy out its current slump. The Fed expects to return the economy to its long term growth rate in 2009, insinuating that this is just regular cyclical recession, and that the trend line is still pointed upward. But in light of recent events “the uncertainty is quite high and the risks remain to the downside” (Bernanke). The market apparently knew this because treasury...
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