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2. 2. Presented to: Mam Nazia Presented by: Tehmina Shahzad Faiza Irshad Maria Yaqoob Misbah Habib
3. 3. HISTORY roots in European settlements in the 16th, 17th, and 18th centuries one fifth of the world economy surpassed that of the U.K economy attracting immigrants the world's largest national economy the Great Depression of the 1930s when danger of recession
4. 4. 4/25/2015 4 CONTID... Fiscal Policy From the New Deal era that began in 1933, to influence the economy. Baby Boomers saw a dramatic increase in fertility in the period 19421957. The boom crested about 1957,then slowly declined. A period of high inflation, interest rates and unemployment
5. 5. OVERVIEW Economy Growth an average of 3.8% from 1946 to 1973 real median household income 2.1% a year characterized by both slower growth averaging 2.7 Faster growth with household incomes increasing by 10% annually. Down Turns Financial crisis of 200708 199091 downturn, when output fell by 1.3%, the 2001 recession, in which GDP slid by 0.3% the 2001 downturn lasted just eight months. 4/25/2015 5
6. 6. Growth Periods The most vigorous, sustained periods of growth from early 1961 to mid-1969 with an expansion of 53% (5.1% a year) In the 1970s and 1980s the U.S. to believe that Japan's economy would surpass that of the United States from late 1982 to mid-1990, at 37% (4% a year) from mid-1991 to late in 2000, at 43% (3.8% a year) CONTI.
7. 7. STRONG ECONOMY World's Largest Single National Economy nominal GDP was estimated to be $16.8 trillion as of 2013, approximately a quarter of nominal global GDP. Its GDP at purchasing power parity is, approximately a fifth of the global total. Its five largest trading partners are Canada, China, Mexico, Japan, and Germany. Well-Developed Infrastructure high productivity. It has the world's seventh-highest per capita GDP (PPP). 4/25/2015 7
8. 8. CONTI. world's third-largest producer of oil and largest producer of natural gas. It is the second-largest trading nation in the world behind China. It has been the world's largest national economy since at least the 1890s.
9. 9. CONTI. Natural Resources the reason that the US economy is so powerful the US has gained control of the natural resources of third world countries. World's Largest Manufacturer As of 2010, the world's largest manufacturer, representing a fifth of the global manufacturing output. Of the world's 500 largest companies, 132 are headquartered in the US The New York Stock Exchange is by far the world's largest stock exchange by market capitalization 4/25/2015 9
10. 10. CONTI.
11. 11. CONTI Foreign Investments Foreign investments made in the US total almost $2.4 trillion investments in foreign countries total over $3.3 trillion. The labour market net migration rate is among the highest in the world. 4/25/2015 11
12. 12. CONTI 4/25/2015 12
13. 13. CONTI the world's second largest trading nation. a large amount of U.S. dollars in circulation all around the planet about 60% of funds used in international trade are U.S. dollars. In 2013, U.S. exports amounted to $2.27 trillion and imports amounted to $2.74 trillion. Trade deficit was $450.3 billion. The deficit on petroleum products was $232 billion. In 2010, the ten largest trading partners of the U.S. were Canada, China, Mexico, Japan, Germany, the United Kingdom, South Korea, France, Taiwan, and Brazil. 4/25/2015 13
14. 14. CONTI 4/25/2015 14 Hard Working While Americans have worked more hours than most other modern nations since World War II
15. 15. CONTI several key reasons The abundance of natural resources in America The relatively low population density of America The development of a strong domestic market in America 4/25/2015 15
16. 16. CONTI. The possession of the majority of the worlds gold (75% to 80%) American investment in foreign countries higher than foreign investment in the US The adoption of the US dollar as the international reserve currency 4/25/2015 16
17. 17. CONTI. Currency and Central Bank The U.S. dollar is the currency most used in international transactions. Several countries use it as their official currency, and in many others it is the de facto currency. The federal government attempts to use both monetary policy and fiscal policy maintain low inflation, high economic growth, and low unemployment. 4/25/2015 17
18. 18. CONTI. Reserve Currency 4/25/2015 18
19. 19. CONTI. US Dollar more stable currencies in the world's primary reserve currency two-thirds of currency reserves Backed By Gold After World War II, America possessed over 80% of the gold in the world devastated from the war aside from America Effectively, American dollars became the "gold of the world". 4/25/2015 19
20. 20. CONTI. After War Effect America became both the world's leading producer and the world's importer of preference. Because the greenback was the international reserve currency, the dollar was adopted as the monetary unit used by OPEC, known as the petro-dollar. This makes foreign trade a much more favourable activity for the US 4/25/2015 20
21. 21. CONTI. Employment There are approximately 154.4 million employed individuals in the US. Government is the largest employment sector with 22 million. The private sector employs 91% Government accounts for 8% of all US workers. Over 99% of all employing organizations in the US are small businesses. The 30 million small businesses in the U.S. account for 64% of newly created jobs (those created minus those lost). Amongst them are Wal-Mart, the largest company which employs 2.1 million people world-wide and 1.4 million in the US alone. 4/25/2015 21
22. 22. CONTI. Research, Development, and Entrepreneurship a leader in scientific research and technological innovation since the late 19th century. phonograph, long-lasting light bulb, movie camera AC induction motor high frequency power transmission used in radio. In the early 20th century, the automobile companies of assembly line first sustained and controlled heavier-than-air powered flight Steve Jobs and Bill Gates are two of the best-known American entrepreneurs of recent times4/25/2015 22
23. 23. CONTI. Wealth, Poverty, and Income Distribution household income had been increasing almost every year from 1945 to 1999 as of 2014, middle class incomes in the United States now lag behind Canada The rise in the share of total annual income received by the top 1 percent has more than doubled from 9 percent in 1976 to 20 percent in 20. the U.S. has a relatively high degree of globalization. U.S. Worker. 4/25/2015 23
24. 24. CONTI. 4/25/2015 24
25. 25. WEAK ECONOMY The Debt Ceiling Crisis congressional leaders reached a deal which agreed to raise the debt ceiling by US $400 billion immediately whilst also cutting government spending by hundreds of billions of dollars over the next decade. 4/25/2015 25
26. 26. Contd Stubbornly High Unemployment Long Term Supply capacity could potentially be reduced creating a long term supply side problem for the US economy. Long term supply effect GDP, shown below 4/25/2015 26
27. 27. Contd Gross Domestic Product 1.8% annual pace between January and March, marking The government revises its GDP figures several times Consumer Spending 4/25/2015 27
28. 28. Contd U.S. Exports US exports to other countries contracted and government spending cuts continued to be the largest drag on economic growth. Whether Conditions the weakening in economic data on bad weather conditions that have gripped much of the US. disruptions in economic activity diversion of real wealth from wealth generating activities to non-wealth generating activities. 4/25/2015 28
29. 29. US suffers unemployment Structural Unemployment structural problems within an economy and inefficiencies in labour markets when a labour market is not able to provide jobs for everyone who is seeking employment. mismatch between the skills of the unemployed workers and the skills needed impacted by persistent cyclical unemployment 4/25/2015 29
30. 30. Contd 4/25/2015 30
31. 31. Contd Dangerous unemployment Structural unemployment could be the main reason of cyclical unemployment kind of unemployment that ticks up during recessions Cyclical unemployment is the most serious type of unemployment, because it caused by a lack of demand. 4/25/2015 31
32. 32. TYPE OF ECONOMY SYSTEM OF US Capitalism limit concentrations of power the American economy is perhaps better described as a "mixed" economy, government playing an important role along with private enterprise, who aimed mainly to maximize profit. Social Capitalism social capitalism involves heavy government regulation of businesses graduated income tax inheritance tax social security welfare mixed, free market economy that goes hand in hand with the democratic government 4/25/2015 32
33. 33. ECONOMIC GROWTH OF LAST TEN YEARS Year Real GDP Population GDP per capita Growth Rate 2001 0.3 278,058,900 -1 1.07891E-09 2002 2.45 280,562,500 1 8.73246E-09 2003 3.1 290,342,600 2 1.0677E-08 2004 4.4 293,027,600 3 1.50157E-08 2005 3.2 295,734,100 2 1.08205E-08 2006 3.2 298,444,200 2 1.07223E-08 2007 2 301,139,900 1 6.64143E-09 2008 1.1 303,824,600 0 3.62051E-09 2009 -2.6 307,212,100 -4 -8.46321E-09 2010 2.8 310,232,900 2 9.02548E-09 2011 1.7 313,232,000 1 5.42729E-09 4/25/2015 33
34. 34. GDP Per Capita GDP per capita can be shown from the chart below of previous ten years. 4/25/2015 34
35. 35. Population Population of USA can be shown from the graph below of last ten years. 4/25/2015 35
36. 36. Real GDP Real GDP of USA can be shown from the chart below 4/25/2015 36
37. 37. The Current State of the US Economy Explained In One Chart 4/25/2015 37
38. 38. Contd the US is producing 5.6% more output (real GDP) than in the fourth quarter of 2007 economy was able to achieve a complete recovery from the Great Recession in terms of real GDP producing $843 billion more output than in Q4 2007 corporate profits are at record levels and more than 40% above the pre-recession 4/25/2015 38
39. 39. Questions 4/25/2015 39
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