The American Economy: Problems and Procedures-1
19/11/2013 16:08
The American economy has been showing a downward trend for the last few years for various reasons. Although there are many arguments for and against the existence of this downward trend, there are some real problems that have haunted the American economy for the last few years.
Budget cuts in research and development, unfriendly atmosphere and lag, development of technology for outsourcing, aging citizens, lower human capital, corporate competition and loss of margin, renovation of India and China to meet international standards for products and services, the cost of American academies and sponsorship system, and the entrepreneurial mentality of Asia's new generation are major problems which deeply wounded the US dollar.
Presently, the unemployment rate of 7.3%, massive lay-offs by General Motors and airline bankruptcies and corporate pension woes are major concerns. These trends further weakened the US dollar and caused fear among potential investors. Over time many of them have opted for the China as a safer investment destination than the US.
Potential investors may well consider themselves better off investing in the rising powers for the next five years when they consider the current situation and future eventualities weakening the American economy and the US dollar at this time.
As the electric companies are forced to depend on natural gas its price is increasing. At the same time, Canada has started using its own natural gas and the production of US gas decreased and gasoline price 38% in2012-13- in 2009 60% it was still increasing every year.
Any sharp increase in the oil price in the international market will badly affect the US dollar's growth and result in inflation. Today, the higher costs of food and fuel are also major concerns among experts. The GDP growth rate is only 2.21% and the percent is less than satisfactory. There is also a strong opinion among experts that it will slow down again.
The condition of the euro is not much brighter. The euro zone GDP growth gone down between 0.1% -0.2% and 0.3% less than in previous quarter and will continue losing from there. We should not forget that China is still growing 7.2% per annum and that Japan is again emerging as a potential market for sure return on any investment.
It will take some time for the war-troubled and internal crises stricken American economy to come out of its current slump. t is also important to note that America is still not free from the threat of terrorism, and it will take many years to clean up the scenario. So there is the possibility of further plunge for the economy, which could cause loss for any investors. Federal debt is increasing more than ever each citizen's share of this debt is $54,243.16 and increasing in an average of $2.73 billion per day. It is now on Sept. 30, 2013, the last day of fiscal 2013, the federal debt subject to limit stood at $16,699,396,000,000 – It is predicted to touch the first month of fiscal 2014, the debt subject to limit stood at approximately $17,108,378,000,000. -
For an investor, the American dollar is prone to be more affected than the rising economy in the coming few years.
By:
Cm_a The Contentlab
https://contentlab.webnode.com/
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