US Economy

Introduction

`The U .S . economy is strong and growing stronger (About the Fed 2007 . It is reassuring to know the Federal Reserve exudes such confidence , but can such claims be substantiated ? The state of health of any economy , concerns all citizens , regardless of the form of governance . The U .S . economy , apart from concerns of citizens of the country , has global impact , especially in the current geo-political context . It is also a torch bearer for private enterprise and freedom throughout the world . This is why the state of the U .S . economy

is of such widespread comment and interest

This document attempts an overview of the status of the U .S . economy as of May 2007 , with a focus on the impact of interest rate decisions of the Federal Reserve Board . The concludes with observations about near and mid-term prospects for economic prosperity in the United States Overview of the U .S . Economy Today

The Jobs Growth Act of 2003 has acted as a strong stimulus for the economy of the United States , and puts it in a strong position to continue world domination in the years to come (About the Fed , 2007 . A strong labor market is the foundation for sustained economic growth because only consumers with financial security and means can spend to buy products and services . A prime feature of the U .S . economy is the monthly creation of new jobs , which is the basis for strengthening domestic consumption prospects . The latter in turn , stimulates fresh investment . This is why the Federal Reserve believes that the U .S economy could be on the verge of an upswing after a downward trend during the second half of 2006 (About the Fed , 2007

Real GDP growth has been 1 .9 over the last 4 quarters as of May 2007 (About the Fed , 2007 . This is impressive considering the absolute size of the U .S . economy , and the performance of other countries of the first world in this respect . Consumer spending is on the upswing , indicating that economic growth prospects in the near term continue to be positive The consumer price index has risen by a manageable 0 .4 in April 2007 (Bureau of Labor Statistics , Not Dated

The stage is set for continued economic growth in the United States Principal macro-economic indicators are positive , while the country has also succeeded in reigning in excessive demand growth . A major strength of the present state of the economy and the way in which it is stewarded , is the positive impacts it has on the lives of ordinary citizens , facilitating ways of achieving financial security in real terms Unemployment

Trends in unemployment are amongst the most sensitive aspects of economic management at the country level , because it has such high impacts on people at large . Any policy which seeks to strengthen the economy at the cost of creating more jobs will be difficult to sustain especially in democratic forms of governance

2 million new jobs have been created in the 12...