An economy is the amount of money made and used in a particular country or region. The United States is the world’s biggest economy, accounting for roughly 16% of the global economy. The European Union, which is made up of 27 European countries, is the world’s biggest economic region, accounting for 17% of the world’s economy.
Economics look at a number of factors when considering the relative strength of an economy. One of the main considerations is the gross domestic product (GDP). GDP is a measure of all the goods and services produced in an economy and it is generally calculated on a quarterly and annual basis.
Sustained economic growth positively impacts income, employment levels, consumption, and the overall standard of living. In a strong or growing economy, businesses increase their sales, hire more people, are more confident about the future, and invest more in their companies. Consumers earn more, are more optimistic about the future, and spend more.
In the years leading up to the 2008 financial crisis, the U.S. reported annual GDP growth of around three percent. Since the 2008 and 2009 recession, U.S. GDP has been more subdued at around 2.2%.
When considering the strength of an economy, economists also look at inflation, interest rates, jobs growth, consumer demand, population growth, standard of living, and social and political factors.
By measuring this data on an annual basis, economists can determine if an economy is expanding or contracting. An economic analysis can also help investors get a general idea of market conditions and possible trends.
A Bad Sign for Stocks? In an ominous sign for equities, U.S. companies appear to be buying back fewer shares than they have over the last four years. Share buybacks announced for the second quarter fell to their lowest point.
Housing Starts Up 2.1% Obtaining a building permit is one of the first steps in constructing a new building. Therefore, the number of building permits can be a great gauge of future construction activity. On Tuesday, August 16, the U.S..
Subdued Prices Help Fed to Stay on Sidelines Consumer prices in the U.S. were unchanged last month as gasoline prices declined for the first time in five months and core inflation slowed, improving chances that the central bank can afford.
Low Returns Driving Investors to Corporate Bonds Investors are willing to accept the smallest corporate bond yields when compared to U.S. Treasuries in a race to find returns. A Bloomberg yield analysis shows that corporate bond yield spread over Treasuries.
Measure of Home Builder Confidence Gains in August New York, NY — Builders in the U.S. feel more confident that demand for single-family homes will remain strong, boosting prospects for the economic recovery in the world’s largest economy. The National.
Budget Deficit Up 10% Fiscal Year-to-Date New York, NY—On Wednesday, August 10, the U.S. Treasury Department released its Monthly Treasury Statement. It showed that in July, outlays by the U.S. government exceeded revenues by $112.8 billion. (Source: “Monthly Treasury Statement.
Prices Paid by Manufacturers Decline New York, NY — Prices paid by the U.S. manufacturers dropped in July driven by global weakness in demand and falling energy prices. The producer-price index, a measure of what manufacturers and companies pay to.
Sales Figures Almost Unchanged from Prior Month New York, NY — Retail sales in the U.S. were unchanged in July as consumers reduced spending on clothing and other goods, signaling some slowdown in consumer spending and raising questions over the.
Bureau of Labor Statistics Reports July Increase New York, NY — Prices of U.S. imports rose last month, signaling some inflationary pressure in the economy going forward. Imports advanced 0.1% in July, the U.S. Bureau of Labor Statistics reported today,.
Nominal Disposable Income Set to Grow 4.4% New York, NY — The latest data on growth in U.S. gross domestic product (GDP) turned out to be disappointing. But one of the major firms on Wall Street just said that income.