AMERICA’S ECONOMY COULD BE HEADED FOR ANOTHER MASSIVE HITCH ?

According to a news America’s economy could be headed for another massive setback if the union representing the nation’s largest private delivery company, UPS, goes on a nationwide strike this summer. The union, The Teamsters, voted to authorize a strike as soon as August 1 if a deal on a new contract is not met. The union is seeking higher wages, more full-time jobs, an end to forced overtime and harassment, elimination of a two-tier wage system, and air conditioning for delivery trucks1. The strike could disrupt the U.S. delivery system and put pressure on President Joe Biden to intervene

There are some articles that suggest that the American economy could be headed for another massive setback1. However, it is important to note that the economy is complex and there are many factors that can affect it. It is difficult to predict the future of the economy with certainty.

The American economy has had its ups and downs in the past few years. According to an article by The Economist, the turbo-charged phase of the American economy’s rebound from the covid-19 pandemic is over. Growth in the third quarter tumbled to an annual rate of just 2%, below already weak expectations and well down from 6.7% in the second quarter1. However, it is important to note that the American economy has experienced a long period of economic expansion2.

WHAT CAUSED THE SETBACK ?

According to an article by The Economist, primary factors believed to have led to the recession include the following: restrictive monetary policy enacted by central banks, primarily in response to inflation concerns, the loss of consumer and business confidence as a result of the 1990 oil price shock, the end of the Cold War and the subsequent decrease in defense spending, the savings and loan crisis and a slump in office construction resulting from overbuilding during the 1980s

According to some sources, the US economy is still running on a post-COVID sugar high that’s about to run out and make 2023 feel miserable1. Some factors that could contribute to this include households not being as flush with cash as they were one year ago, the historically-great jobs market probably being on its last legs, the Fed’s crackdown on inflation causing more economic pain and Congress probably not riding to the rescue in the next recession.

WHAT IS RECESSION ?

According to some sources, the US economy is still running on a post-COVID sugar high that’s about to run out and make 2023 feel miserable1. Some factors that could contribute to this include households not being as flush with cash as they were one year ago, the historically-great jobs market probably being on its last legs, the Fed’s crackdown on inflation causing more economic pain and Congress probably not riding to the rescue in the next recession

A recession can be caused by a chain of events in the economy, such as disruptions to the supply chain, a financial crisis, or a world event1. It can also be triggered after an inflationary period. When inflation increases, central banks raise interest rates to slow the economy with the goal of bringing down inflation. With higher interest rates, the probability of a recession increases, leading to layoffs, fewer jobs, and decreased consumer and corporate spending

AMERICAN ECONOMY FACING DIFFICULTIES IN 2023 ?

Stanley Druckenmiller Expects a US Recession in 2023 on Fed Tightening1: The web search result suggests that the US economy is likely to face a recession in 2023 due to the effects of pandemic-era stimulus fading, high inflation, slowing wage growth, dwindling savings, and aggressive rate hikes by the Federal Reserve. Some analysts expect the recession to be mild, while others warn of a hard landing and near-zero growth.
5 economic challenges that await us in 2023 – DW – 01/02/20232: The web search result outlines some of the major challenges that the global economy, including the US, will face in 2023, such as the war in Ukraine, high inflation, supply chain disruptions, energy crisis, and climate change. The web search result also predicts that the US and other major economies will slip into a recession this year as central banks continue raising interest rates to temper demand and rein in inflation.
United States Economic Snapshot – OECD3: The web search result provides a brief overview of the US economic outlook for 2023 and 2024, based on the OECD projections. The web search result states that real GDP is projected to grow by 1.6% in 2023 and 1.0% in 2024. Growth in private consumption and investment is expected to moderate in response to the tightening in monetary and financial conditions and as savings are further depleted.
Economic Forecast 2022 And Beyond: Good Now, Scary Later – Forbes4: The web search result presents an economic forecast for 2022 and beyond, based on the author’s analysis. The web search result states that the economic outlook for 2022 and 2023 in the US is good, though inflation will remain high and storm clouds grow in later years. The web search result also discusses some of the factors that could affect the US economy, such as the war in Ukraine, trade tensions with China, fiscal policy, and consumer confidence.
Most important problem facing the U.S. 2023 | Statista5: The web search result shows a survey result of what Americans think is the most important problem facing the US in April 2023. The web search result shows that nine percent of survey respondents said that the high cost of living and inflation was the most important problem facing the US. Another 18 percent said that the government and poor leadership was the most serious problem for the nation.
Americans Largely Pessimistic About U.S. Prospects in 2023 – Gallup.com6: The web search result shows a survey result of how Americans view the prospects for the US in various domains in 2023. The web search result shows that Americans are largely pessimistic about the US prospects in 2023, as majorities predict negative conditions in 12 of 13 economic, political, societal and international arenas.

HOW AMERICAN ECONOMY CAN BE HEALED ?

Controlling the pandemic and ensuring a smooth and equitable vaccine rollout1.
Providing adequate fiscal support to households, businesses, and state and local governments that are struggling due to the pandemic-induced recession1.
Addressing the underlying causes of polarization and radicalization, such as income inequality, geographic disparities, systemic racism, and the rise of digital technology2.
Promoting national unity and reconciliation through dialogue, storytelling, community engagement, and civic education23.
Balancing the monetary policy to curb inflation without stifling growth or causing financial instability1.
Investing in infrastructure, innovation, education, and health care to boost productivity and competitiveness

Leave a Reply