What is MacroWeb?

High Growth Shows Economic Recovery

Our economy experienced high growth this last quarter of 8.2%.  This is the highest that growth has been since the first quarter of 1984.  Does this mean that our economy has recovered from the recession that we had a couple of years ago?  According to Democratic Congressman Pete Stark, "Any good news on the economy is welcome, but it would be premature for President Bush to declare mission accomplished"_.

While we experienced a high growth we only saw wage increases 2.9%, barely keeping up with inflation.  We also still have unemployment of 6.1%, which is higher then economist would like to see it.  So how did our economy still manage to grow?  The two biggest factors were the really low interest rates and the tax cuts. 

Even though our economy still has some things to recover from, we are experiencing recovery because consumer confidence is up.  Consumer spending was up 6.6% which shows consumers are more confident to spend their money.  The 6.6% raise is believed to be a result of the tax cuts and low interest rates that gave consumers more money to put back into the economy.  Hopefully this means that we are on our way to having the effects of the recession erased.