We have skilled the worst economic recession given that the 1930s, within the current past. But think it or not, this period (3rd quarter, 2009), has been the top in about two years. The US economy has grown at about three.5%. The Commerce Department’s report released yesterday indicated that, although these are early days and points aren’t 100% clear, the recession has indeed ended.
Before this quarter, there had been four consecutive quarters of diminishing economic activity, which was skilled for the very first time given that 1947. But this quarter’s performance has been very good, and it is the very first time, that we have one thing to cheer about considering that the depression hit us, within the last month of 2007. It can be fair to say that this growth has not been completely unexpected considering that the growth projection was about three.3%, but yes, the even greater growth of three.5%, is surely welcome.
The government programs are largely to be thanked for this turnaround, specifically the push given towards the housing and automobile sectors. 1 such program was the ‘Cash for Clunkers’ program, in which a rebate of about $4,500, was provided on buy of new vehicles. Trade-in of old vehicles, too was promoted in a big way. Consequently of all of the government initiatives, large spending rose by much more than 22% annually, this quarter, the most effective showing given that 2001.
The housing sector also managed to do quite effectively. Annual growth is over 23%, an unbelievable rate, that was last observed only inside the 1980s. It’s also the very first time given that way back in 2005 that spending on housing showed a positive sign.
While points appear to be very good, going ahead, it perhaps wise to be cautious and maintain our fingers crossed.
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