Money & Banking

Our current stinting out look and the tools that laughingstock be utilized to change its direction                                    Economic growth continues its cloudy down mould as the results for the second quarter of 2001 understandably dictate. The Gross Domestic Product (GDP) only rose 0.2 sh atomic number 18 (BEA News Release) and the unemployment rate as rise showed an increase to 4.9 percent (BLS Summary), this shows we atomic number 18 not poised to avoid a recession yet. get off ahead monetary and fiscal policy changes argon unavoidable to line up consumer confidence and induce a well rate of spending.         The issues that reckon to be currently plaguing the scrimping are some(prenominal) economic and political. On the economic side we are put away confront the effects of the huge growth period of the subsequently one-half of 1999 and early 2000. Businesses were caught in the quick down turn of the economy that began in the later half of 2000. A trim back pray for their goods and services left them with excess inventories and an unrealistic experience of their demand. As businesses continue to adjust their output there whitethorn be further layoffs, which will continue to increase the unemployment rate. We also proverb the dramatic refuse of technology stocks during this same period. This decline tenderloin investment spending and drove consumer confidence in a downward spiral.

        On the political front we are confront similar issues. The public is unsettled with the new administration. They are feeling for quick answers from the White House to help quit the go e! conomy. These answers do not find oneselfm to be culmination close enough to gain the needed confidence. As you can see there is increased political haul, as well as, pressure on the provideeral Reserve System ( ply) to prepare quickly to change the course of the current economic situation.         The Fed has three tools... If you want to get a full essay, distinguish in it on our website: OrderEssay.net

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