Even as Government spending has decreased and taxes have
increased in the recent months, our economy is still experiencing healthy
growth. The most surprising growth is the growth we are experiencing in the
industrial sector as there was a 0.7 percent increase in the month of February.
This is much more than the forecasted 0.4 percent increase. Such has surprised
some economists enough to increase their first quarter growth predictions to
around 3 percent.
Although we
have been experiencing healthy economic growth consumer confidence is very
insecure. Because of this things such as eating out by Americans is not
occurring often, and sales in the restaurant sector have decreased. This
reduction is being made up for however in the retail market as sales have
increased due to an increase in construction jobs and work going on.
Unemployment
has been the slowest rate to recover from the economic crisis. We should expect
this to get better in the coming months.
I agree with the point you made about consumer confidence Steve. I don't believe that consumer confidence levels are at the levels they were before the 08 recession. With a healing economy we have to give it time. Our economy is cyclical and as we regain our composer coming back into our own economically speaking I believe we will see restored gains in consumer confidence. Tax cuts will eventually help but they will be directly correlated with consumer confidence. If people are not confident in our economy the disposable income created by tax cuts will be saved rather than spent thus not benefitting our economy.
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