The Baleful Effect Of National Debt On The US
High national debt, the spent economic power, the faltering stock market and bond rates, the retirement blues, the aging population, the crippled job market, lowered GDP – doesn’t these all seem familiar? These are the most common characteristics of the US economy. The greatest threat to the US security is the national debt. With the increasing debt stress, the people and also the politicians are losing their confidence over the economy. Till now, no solid plans have been rolled out with regards to getting out of debt and solving the financial woes; for the nation.
National debt and the US
The US Department of Commerce has given away their latest report with regards to the economy, and yet again this isn’t at all good news. The reports show that the economic growth of the nation was not able to meet the expectations. The growth for the gross domestic product of the country or the GDP, stood at 2% in the first quarter of 2012. This is said to be almost a percent low, than what it was in the last quarter of the previous year.
Along with the Federal Reserve, the economists too had expected that the growth in the GDP for the first two quarters would be around 2.5% at the least and may be around 2.9% too. However, the situation is so serious that, the growth was only of about 2%. In fact, as per the latest reports from the Commerce Department, the situation of the US is far from a balanced one. It is not even in a stage, where it is ready to crawl out from the rut that was brought about by the recession in 2007-2009.
The value of the US dollar too were said to have remained low for quite some time, more so in comparison to the Japanese Yen. Though, there has been a rise in the dollar value only recently, it has not been able to ease down the worries of the investors and the economists. According to Chris Williamson, a chief economist at Markit in London, “The US economy remains a bright light in the global economy, although the light is hardly blinding, and also showing some signs of fading,”, as has been said to the Financial Times.
Though the recession is said to be over, the after effects are still not over. The chairman of the Federal Reserve, Ben Bernanke too, is of the same opinion. This is a situation which is not only slow but equally frustrating too. According to him, “Here we are almost three years from the beginning of the expansion, and the unemployment rate is still over 8 percent … It’s been a very long slog.”
Shockingly enough, it has been found that the debt of the nation is supposed to reach to more than 100% of the GDP. The national debt thus, now stands at around $15.692, which is said to be quickly pushing towards the debt ceiling of the nation standing at $16,394.