Has the US economy emerged from recession?
While investors in the UK continue to digest the news that in the opinion of Mervyn King, the Gov of the Bank of England, the UK economy is moving out of recession, it appears the same may be happening in the US. Economic data from the US seems to indicate that economic activity has increased and the US would seem to be on a growth path once again.
If this is the case this will have a significant impact upon the worldwide economy and drag all economies around the world higher and higher as the US recovery gets under way. However, before we all get carried away it is worth remembering that the US may well be in a similar situation to the UK with a potential double dip recession if liquidity and inflation are not correctly managed. Too many investors seem to be getting too carried away in the short term which is ultimately increasing confidence to the point where some people are moving to a blue skies scenario.
Despite the fact that the economic scenario in the UK and the US has improved over the last few weeks there is still a need for caution in the short to medium term. A return to a recession in 2010 is not entirely out of the question and would be a disaster for the US, the UK and the worldwide economy.
Share this..
Related stories
Bank Of England jumps to the defence of Mervyn King
Mervyn King, the Gov of the Bank of England, has today received support from his employers with regards to suggestions he is "looking to talk down the pound". This is a subject we have covered over the last few days, with certain comments from Mervyn King appearing to have been interpreted by the currency markets in a rather depressing manner. However, Mervyn King believes that his comments had be...
Read MoreGame Group issues disappointing trading statement
Game Group today issued a disappointing trading statement and a warning on future probability for the company. Sales in the company's UK and Ireland stores fell by 17.5% over December into early January even though there is "a sizeable installed base of hardware". Only a few months ago the company appeared to be more upbeat on the prospects for the festive period but these hopes have evaporated ov...
Read MoreThe ECB announces Eurozone rate cut
In a move which is expected to at least place a floor under the European economy the ECB today announced a further reduction in Eurozone interest rates from 1.25% to 1%. This is the seventh time that rates have been cut in Europe and is a further reflection of concerns that the Eurozone economy is still very sluggish at best.
There are a number of analysts who expect this latest int...
Gordon Brown urges banks to confirm losses
In a move which is sure to cause yet more friction between the government, UK banks and taxpayers Gordon Brown has come forward to suggest that the UK banking sector should be more forthright with confirmation of losses. If the government is aware that losses are being "hidden" or not disclosed in a forthright manner then why on earth have they already invested billions upon billions into the sect...
Read MoreRecession Watch : Political Polls
One of the first signs indicating the end of a recession is a return of support for the government of the day, i.e. the Labour Party. However, the situation in the UK is slightly different because of ongoing scandals regarding MPs expenses and the recent e-mail sage emanating from number 10 Downing Street. However, many political analysts believe that as and when the UK recession ends we should se...
Read More