United States Economic Situation As A Term Outlook For The Future

2170 Words Jul 26th, 2016 9 Pages
This paper will discuss the United States current economic situation as well as a short-term outlook for the future. I will analyze currencies, foreign exchange, monetary and fiscal policy, GDP/Growth, the stock and housing markets, and debt and unemployment. All of these economic factors can paint a picture for where the U.S. economy stands relative to historical data and provide us with the tools we need to predict/estimate the future. Let’s begin with a closer look at the current U.S. dollar and how its position can heavily affect the global economy. The dollar is strong right now for several reasons. As the economy has slowly recovered from the “mini-recession” of 2008, the Federal Reserve has dwindled and eventually stopped it’s expansive monetary policy. This shortage of a supply makes each dollar worth more, effectively boosting the buying power of the dollar. While this may sound all good and well, it certainly carries some consequences. One of those consequences is the negative effect on exports. The stronger that the dollar becomes, the more expensive U.S. goods become to the rest of the world. On the other hand, we should see an influx of imports as our buying power increases. However, U.S. goods/service imports hit a three year low at the start of 2016. Another reason the dollar is so strong right now is the increased interest rate set in December 2015. A higher interest rate strengthens the dollar because it means higher rates will be paid on short-term…

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