Background of US Economy:
Towards the end of 2014, economists and investors alike wondered how 2015 would be. While some feared that the original downtrend would continue, a few were positive of the New Year. The year started strong and showed hope of a successful economic period for the US economy. The Nationís third quarter GDP was at 3.9% based on analysis of the nation's economic strength since the fourth quarter of 2013 financial year. In 2013, the fourth quarter GDP was at 2.4% while in the first quarter of 2014, it was at 2.9%, mostly this was caused by the impact of the devastating winter, the second quarter of 2014, however, shot to 4.6% (real GDPs) (Whitefoot, 2015).
Following the devastating winter, The US has seen a constant economic growth in both the GDP and other sectors. The GDP has shot, retail spending, consumer confidence, and unemployment showing an upward trend. †The latter is currently at 5.8%. the November retails increased by monthly at 0.7% to a total of $449.3 billion, this is the largest gain since 2014 Match. Economists had projected the November sales increase slightly to 0.4% instead of 0.7%. The subsequent years showed November sales hitting 5.1% (Global Economic Conference, 2015). ††††††††††
It is believed that 2015 has inherited the momentum, which is a significant economic growth for a nation that heavily relies on consumers spending (70% of its GDP). The 2015 economic growth focus at the closing of 2015 was at 3.1%. the figure could indicate the highest economic growth since 2005 (3.3%).
2015 has seen a significant growth in consumer spending owing to the downtrend of oil prices and the fast economic growth of the decade. The boost largely is attributed to the slackening world oil prices. The improving job market is another indicator, which has a significant boost in the economy. Oil prices have been receding since summer owing to increased North American Shale and the constantly weakening global economic situation. Oil prices blunder was furthered by the tough stand of the Organization of the Petroleum Exporting Countries (OPEC) stance of not to reduce its output. On December 11, 2014, the West Texas Intermediate oil reached $60.00 a barrel. This was the recorded lowest oil price since 2009. Some economic analysts believe that oil price will stagnate until 2020.
Despite the growth in US economy, the market is not stable. †When the stock market reaches their highest points, they show signs of weakening. The stock market does not run concurrently with the economic growth. It relies of the exchange between the companies. While the US exchanges are showing strength, other nations across the world depict a different trend. The instability of† other nations directly hit the US economic climate since over half of United States companies have their revenue collected from other parts of the world. Dwindling global economy could lead to slow global sales, which could negatively impact on the US stock market (Whitefoot, 2015).
The situation is worsened by the fact that giant economies are affected. †Among these is China. China reported its third quarter growth at 7.3% from 7.5% in the previous year. The country marked its slowest growth since 2009. A projection indicates even slower fourth quarter. The Fiscal policy indicator of 2014 show that the nation hit the bottom-line economic surge of 7%, growth in 2015 could even worse. Among other affected nations are Japan, France, Russia, and Italy. The economic situation of US in the fourth quarter of 2015 might turn out gruesome rather than rosy. As a fiscal measure, the US government is faced with the challenge of cushioning it is offshore industries (Global Economic Conference, 2015). However, the nation is faced with the fact that it cannot stabilize the world dwindling economies.
Doctorís Economic Opportunity
Whitefoot, J. (2015). What Is the U.S. Economic Outlook for 2015? Good, if Youíre Rich. Profit Confidencial. Retrieved from: http://www.profitconfidential.com/economic-analysis/economic-outlook-for-2015/
Global Economic Conference. (2015). Global Economic Outlook 2015 - Key Findings. Retrieved from: ††††††††††††††† https://www.conference-board.org/data/globaloutlook/