With news organizations incentivized to create the most inflammatory headlines possible, it is hard to tell what the actual state of the U.S. economy is. GDP grew at a 2.3% annual rate in the fourth quarter of last year (adjusted for inflation). We have experience low unemployment and consistent wage growth. All of these things considered, it is safe to say that currently the economy is in a pretty decent state. However, with mass deportation policies and ever increasing tariffs on the horizon, we can not guarantee the economy will continue to grow at this steady pace.
3 comments:
The labor market still sometime's confuses me because certain aspects of it can be more difficult to decipher and draw forecasts for but even with my own lack of knowledge I feel confident in the economy and its ability to persevere. The numbers are always a good indicator.
The 2.3% annual GDP growth rate in the fourth quarter of last year, combined with low unemployment and consistent wage growth, are all positive indicators. However, it is also important to consider the potential risks and uncertainties on the horizon, such as mass deportation policies and increasing tariffs. These policies could significantly impact the economy, disrupting supply chains, reducing consumer spending, and potentially leading to higher inflation. Furthermore, it is also worth noting that the economy is a complex system, and many factors can influence its performance. Currently, GDP=2.3 (adjusted for inflation), investment could decrease, leading to lower GDP. Overall, some potential risks and uncertainties could impact the economy and its future growth.
I think that it will be interesting to see where our economy goes with this mass deportation threat. A decrease in the supply of labor will cause wage inflation which inevitably leads to firms increasing prices to accommodate for the additional expense.
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