There are many signs that indicate that we are experiencing a V-shaped economic recovery. World market capitalization and stock market are showing positive trends. Big banks are recovering and annual deficit spending is decreasing. However, the recovery is not robust. It is only a moderate one and it will take years before our country gets back to normal. Unemployment, status of our currency and public and private debt are the dominant factors in economic recovery. Jobenomics is an excellent piece of writing by Chuck Vollmer, which lets us understand the viable ways to get economic recovery. We can find a lot of useful information by reading this book. If you want to buy it, just visit www.jobenomics.com to get additional details.
The Fed, Treasury and FDIC are providing stimuli, bailouts and buyouts to speed up the economic recovery. By the end of 2010, most of the funds will likely be spent. However, we are experiencing several problems like high unemployment rate, dollar status and public debt, which hinder the recovery process. Unemployment rate above 10% will become a serious issue, which could destabilize consumer spending and investor confidence. The international organizations are already devaluing our currency and forcing for a new reserve currency. A weaker currency can help to make our exports stronger, but we still import more. If oil imports increase by $50 per barrel, due to a weaker currency value and increased demand, we need to spend $219B extra every year. This money could be spent productively on some other purposes.
Public debt worth $12.9T and private debt worth $16.5T could suppress capitalization, which is important for business growth and expansion. The sum of private and public debt is twice the size of our annual Gross Domestic Production. As more and more attention will be given to debt servicing, production of goods and services will receive less attention. However, producing goods and services is crucial to economic growth.
Our country is recovering after two years of struggle. The duration of the Great Recession was about two years and a stable economic recovery will take a long period. Economy can be distressed in many ways. Fluctuations in monetary policy, asset bubbles, financial crises, recessions and oil shocks can affect economy significantly. The Great Recession was in fact a combination of a financial crisis, recession, oil crisis, asset bubble and monetary fluctuation. Hence, it will take more time to recover fully. High demand for capital and resources in rapidly growing markets like China and loss of manufacturing competitiveness in our country can make recovery very difficult.
The 1982-1983 Recession’ recovery was strong. Nearly two million jobs were added to the workforce in the fourth quarter of 1983. However, it took another five years to reduce the official unemployment rate to a normal range. Recovery after the Great Recession is moderate, so it will take even more time to reduce the unemployment rate to a comfortable level.
Jobenomics analyzes the dominant factors in economic recovery and suggests the practical ways to come out of the crisis. It is an excellent read for people, who have interest in protecting the future of our country. You can get a copy of this book from www.jobenomics.com