The Fourth Quarter
By: Amanda Dabney
Recession tends to be a word that most people are terrified over. This economic crisis is characterized by a downturn in economic activity, which is typically evident through a decline in the real GDP and also employment levels. Throughout 2008 and 2009 the United States suffered a severe recession that shook the economic foundation of America. Since then, the economy has been trying to bounce back and regain a foothold upon some level of normalcy. This past quarter symbolized a positive sign for the regeneration of the American economy.
In economics a year is divided into four quarters for analysis. The fourth quarter of 2013 ended with the GDP growing by 3.2%. GDP, or gross domestic product, represents the market value of all the goods and services that a singular country produces during a specific time period.
In the video above GDP is further explained.
The graph below illustrates the growth that has been occurring since the end of 2011. As evident, a road full of turmoil has marked the growth of the nation. Fortunately though, this past quarter was significantly better than other past quarters.
A significant reason for the increase in GDP that resulted in the final quarter was a result of consumers spending more money. This can also be attributed to the holiday season where gift purchasing was at a maximum. Nonetheless though, the growth could have been more if the government shutdown that occurred in October wouldn’t have happened, and if government spending wouldn’t have dropped so drastically, to be precise by 12.6%. Fortunately though, businesses throughout the nation invested into their operation and machinery quite a bit contributing to the increase in GDP.
The recession has had lasting effects on the economy, but fortunately it is projected that the growth will stabilize in this coming year, and most likely at a rate of 2.5% in growth. This analysis of the economy is crucial because it shows the health of the economy, or in some cases a sick and diseased economy. GDP’s are not only powerful tools illustrating the success of an economy but are also the crucial factor in determining market exchange rates and purchasing power. A common misconception though is that a high GDP means that all or at least most of the individuals in the nation are well off. This is not true at all though and can be seen in the fact in the United States who has a relatively strong GDP still has over 50 million individuals living in poverty.
GDP is a necessary tool in analyzing any nations economy. It gives great insight into trends and outlooks for the future. The quarter analysis that are performed are necessary in order for the nation to see what the coming year holds and what needs to be done. The United States went through a very difficult time a few years back and the nation is starting to enjoy a recovery. All economic problems take time to fix, but luckily there is a way to measure amount of growth that needs to occur. Therefore, the United States should be happy with the growth that occurred in the last quarter but should not settle at this level and still strive for more.
Bibliography
"Federal Reserve Bank of San Francisco." SF Fed. N.p., n.d. Web. 3 Feb. 2014.
<http://www.frbsf.org/education/publications/doctor-econ/2007/february/recessiondepression-
difference>.
"Gross Domestic Product: An Economy’s All - Back to Basics: Finance &
Development." Finance & Development. N.p., n.d. Web. 3 Feb. 2014.
<http://www.imf.org/external/pubs/ft/fandd/basics/gdp.htm>.
Heavey, Susan. "U.S. poverty rate remains high even counting government aid."
Reuters. Thomson Reuters, 6 Nov. 2013. Web. 3 Feb. 2014.
<http://www.reuters.com/article/2013/11/06/us-usa-economy-povertyidUSBRE9A513820131106>.
Kurtz, Annalyn. "Economy grew solidly in fourth quarter." CNNMoney. Cable News
Network, 30 Jan. 2014. Web. 1 Feb. 2014.
<http://money.cnn.com/2014/01/30/news/economy/gdpreport/
index.html?iid=SF_E_River>.
Press, The. "US Economy Grew at 3.2 Percent Rate in Q4." ABC News. ABC News
Network, n.d. Web. 3 Feb. 2014.
<http://abcnews.go.com/Business/wireStory/economy-showed-strength-end-2013-
22293866>.
"The Recession of 2007-2009." Bureau of Labor Statistics . N.p., n.d. Web. 3 Feb.
2014. <http://www.bls.gov/spotlight/2012/recession/pdf/recession_bls_spotlight.pdf
Recession tends to be a word that most people are terrified over. This economic crisis is characterized by a downturn in economic activity, which is typically evident through a decline in the real GDP and also employment levels. Throughout 2008 and 2009 the United States suffered a severe recession that shook the economic foundation of America. Since then, the economy has been trying to bounce back and regain a foothold upon some level of normalcy. This past quarter symbolized a positive sign for the regeneration of the American economy.
In economics a year is divided into four quarters for analysis. The fourth quarter of 2013 ended with the GDP growing by 3.2%. GDP, or gross domestic product, represents the market value of all the goods and services that a singular country produces during a specific time period.
In the video above GDP is further explained.
The graph below illustrates the growth that has been occurring since the end of 2011. As evident, a road full of turmoil has marked the growth of the nation. Fortunately though, this past quarter was significantly better than other past quarters.
A significant reason for the increase in GDP that resulted in the final quarter was a result of consumers spending more money. This can also be attributed to the holiday season where gift purchasing was at a maximum. Nonetheless though, the growth could have been more if the government shutdown that occurred in October wouldn’t have happened, and if government spending wouldn’t have dropped so drastically, to be precise by 12.6%. Fortunately though, businesses throughout the nation invested into their operation and machinery quite a bit contributing to the increase in GDP.
The recession has had lasting effects on the economy, but fortunately it is projected that the growth will stabilize in this coming year, and most likely at a rate of 2.5% in growth. This analysis of the economy is crucial because it shows the health of the economy, or in some cases a sick and diseased economy. GDP’s are not only powerful tools illustrating the success of an economy but are also the crucial factor in determining market exchange rates and purchasing power. A common misconception though is that a high GDP means that all or at least most of the individuals in the nation are well off. This is not true at all though and can be seen in the fact in the United States who has a relatively strong GDP still has over 50 million individuals living in poverty.
GDP is a necessary tool in analyzing any nations economy. It gives great insight into trends and outlooks for the future. The quarter analysis that are performed are necessary in order for the nation to see what the coming year holds and what needs to be done. The United States went through a very difficult time a few years back and the nation is starting to enjoy a recovery. All economic problems take time to fix, but luckily there is a way to measure amount of growth that needs to occur. Therefore, the United States should be happy with the growth that occurred in the last quarter but should not settle at this level and still strive for more.
Bibliography
"Federal Reserve Bank of San Francisco." SF Fed. N.p., n.d. Web. 3 Feb. 2014.
<http://www.frbsf.org/education/publications/doctor-econ/2007/february/recessiondepression-
difference>.
"Gross Domestic Product: An Economy’s All - Back to Basics: Finance &
Development." Finance & Development. N.p., n.d. Web. 3 Feb. 2014.
<http://www.imf.org/external/pubs/ft/fandd/basics/gdp.htm>.
Heavey, Susan. "U.S. poverty rate remains high even counting government aid."
Reuters. Thomson Reuters, 6 Nov. 2013. Web. 3 Feb. 2014.
<http://www.reuters.com/article/2013/11/06/us-usa-economy-povertyidUSBRE9A513820131106>.
Kurtz, Annalyn. "Economy grew solidly in fourth quarter." CNNMoney. Cable News
Network, 30 Jan. 2014. Web. 1 Feb. 2014.
<http://money.cnn.com/2014/01/30/news/economy/gdpreport/
index.html?iid=SF_E_River>.
Press, The. "US Economy Grew at 3.2 Percent Rate in Q4." ABC News. ABC News
Network, n.d. Web. 3 Feb. 2014.
<http://abcnews.go.com/Business/wireStory/economy-showed-strength-end-2013-
22293866>.
"The Recession of 2007-2009." Bureau of Labor Statistics . N.p., n.d. Web. 3 Feb.
2014. <http://www.bls.gov/spotlight/2012/recession/pdf/recession_bls_spotlight.pdf
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