Free Macroeconomy in the U.S. Essay Sample

Micro economic generally refers to how individual economic units interact in the economy. In the U.S, the unemployment rate ranges between 9% and 10%. This is a very large rate as compared to other nations. This makes it hard for the U.S to reclaim its global dominance. However, it fell from 9.4% to 9.0% by the end of last year. Employed people are those people who are in the work force and this research shows that more people joined the work force by the end of last year compared to other years. More jobs means that the government incurs less expenses while paying for social services or employment insurance and also more people are paying their debts. Many housing markets are still empty in the U.S. Many people are not buying them simply because they are not confident in them. Many people are still unemployed and they even don’t qualify to be given loans in the bank.

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The U.S has kept its interest rates near zero, showing that the economy is still having struggle producing. Rising interest rates would perplex the economy even further. Interest rates are always an indicator of where the economy is going. Rising interest rates indicate that the central bank believes that enough people will continue to borrow money at that high interest rate so that the economy will not collapse. Raising interest rates also slows inflation. At the moment, America’s debt load is very huge and it is growing significantly. This will depress the economy and minimize its growth. This debt has been due to the low interest rates which encourage borrowing for the business sector as well as consumers looking for homes. In order to service their own debt, the U.S relies on foreign money. Their bonds are purchased by other countries, but that demand is decreasing as America becomes so in debt other countries like China are questioning the validity of America’s economy and their ability to repay. America is therefore losing its figure as a world economy superpower.

It is evident that the recession of the U.S is large compared t other nations at the moment but the equally large monetary solutions haven't had their expected result. These policies should try to increase the rate of employments. This will act as the pillar to a growing economy since the rate of inflation will also decrease.


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