Macroeconomics

Macroeconomics Macro Economics The business cycle is on a slow upturn. We had a recession in 2001 and came out of it in the fourth quarter. Since then real GDP has been growing at a slow rate. The unemployment rate reached 6% in April of 2002 and since then has been between 5.6 and 5.9 percent, which is higher than the 4 % in the late 1990’s. Unemployment is higher now than it was in the recession last year when it was about 4.5 to 5.0 percent. However, the unemployment rate has decreased since the spring and summer when it was around 6.0 % and now is 5.7 %. The M2 money supply has been growing since the beginning of 2001. The velocity of M2 has decreased from 2.05 to 1.85 in the same period. This could indicate people are saving more of their money in safe places such as savings accounts and CD’s instead of riskier financial assests such as stocks and mutual funds. This is reinforced by the stock market that is shaky and continues to sputter, which has been a negative contributor to business cycle leading indexes. Political issues have probably rate, been, increase, income, year, unemployment, spending, money, m2, increasing, decreased, about, 2001, slow, since, now, last, increased, growth, gdp, economy, economic, cycle, business, velocity, using, upturn, tax, supply, real, rates, personal, new, negative