The American Economy

February 15, 2015

By: Jordan Taylor

The American economy is finally on the rise after an extremely poor first quarter in 2014, bouncing back with a 4.6% increase in GDP in the second quarter and a 3.9% increase in the third quarter.  There is evidence showing economic expansion, with the national unemployment rate at a six year low and down to nearly half of what it was in 2009, the addition of 2.3 million jobs to the American economy in 2014, and the stock market currently sitting at an all-time high.  All these measures show us a strong and growing American economy, however, many Americans remain worried about their economy.  On the flip side, the long term unemployment rate has more than doubled since 2007 to 2.9 million in 2014, and the middle class American family is still bringing home the same income per household as they did in 1995.  The gap between the upper and middle class is growing, with the 1% becoming wealthier and the middle class staying inactive.  The record high in the stock market is great for the American economy, however, only Americans who have invested money in the stock market will see any benefit from the current market standing.  With the recession ending years ago, America has yet to truly bounce back from the economic recession in 2008.  Despite showing strong signs of economic growth, these signs are masking some of the issues which have actually gotten worse.  What CNN describes as a “dual economy,” refers to President Obama’s message stating that the economy is much better off and America is in a much better place than it was a few years ago, despite the long term unemployment rate increasing and the median household income actually decreasing.  With two sides to the argument, it will be interesting to see what will happen to the American economy in 2015.  The current low price of oil has led to a decrease in the price of gas nationwide, which has and will act as a stimulant to the economy with respect to consumer household disposable income and an increase in consumer spending.  The low price of oil will be beneficial in the short run to the American economy, and if the price of oil stays low, the economic stimulation will continue and will help close the gap between the upper and middle class and increase consumer spending.

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