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The American economy.

January 31, 2013

The united state  of America is the first economy in a World.  An economy which doesn’t have the same speed in all the country.California by itself is the seven Economy in the planet.   During several years, the American economy has had deferent  scale. That Economy where President, who has lead that Country has taken several measures, to bring it again to his best level than before.  An economy which have a good position in a world sustain by one of the best enterprise in a world. 

Several years, several program lead by the American President to save the Economy.
In 1960, the American Economy was at his best. President Kennedy brought deferent measure like cutting tax which boost the Economy growth by 4.3 to 6.6 percent. By enacting tax, several jobs has been  creating. The unemployment fall at his lowest rate than thirty years before. Wages from workers rise. The national Debt was both time larger in 2003 than in 1960. The tax rate has been reduced from 91 to 70 %. The measure of cutting tax is not new, this has been used other president too, but it really works a lot during Kennedy time. One of the reason which which justify that success is the low rate of immigration. America was still facing problem of segregation, Kennedy will also die desperately years later.

 There have been other period where the American economy was well in the period of Renald Reagan the actor. This man had a vast program in the American Economy which really works. During , his time , he reduced personal income tax, the inflation fall down, and the dollar was strong, deregulate industry like energy, Financial services, and transportation. The reexamining program, followed a boom which last several years.

 Georges H W Bush, father  decided to cut tax like Kennedy did,when he arrived in power. But this time didn’t really work.A great amount of money is spending on American Economy. Bush spent much  on war. The national debt  is so high than any other period of USA. Even the tax are not Profitable.

Clinton decided to increase, the tax rate was so high, one of the most exorbitant in American history. The number of people in welfare decline by 4.4 to 1.9 million, an astonishing 58% of slide considered by everybody as Heroic. Clinton time was good but live  the American economy with a big hole.

 Georges W Bush, program was about to reform the social security, he opted for the Broad tax cut. Georges Bush period was marked with marked with many terrorist act like 9/11 .He decided to send Soldiers in Iraq and massive funds were spend to take care about soldiers in Iraq which double government expenditure.

Barack Obama, came like to burry the big hole left by bush. He opted for his program for  a kind of tax relief, vote for a new law, unemployment insurance, and there’s a real changeling in employment than in his predecessor period. He opted for affordable care by promoted affordable care for everybody. He decided to withdraw soldiers in Iraq, and improve the number in Afghanistan.
 
Why is the US dollar weak?
Although financial markets rose sharply after George Bush’s decisive re-election, the huge imbalances plaguing the US economy have not gone away. Attention has now refocused on these structural problems, hence the renewed pressure on the dollar. America has a massive deficit in its current account – it is importing far more goods and services than it is exporting. The size of the gap in dollar terms, the amount of so-called “red ink”, is close to $600bn (£325.6bn) – almost 6% of America’s overall economic activity.

Why is the American economy has a big deficit now.
 
In some ways, America’s deficit has served the global economy well. By acting as a consumer of goods produced in Europe and Asia, the US has fulfilled its traditional function as an engine of growth. The countries with a current account surplus, particularly those in Asia, in turn send the proceeds back to the US as investments, mostly in US treasury bonds. These investments help to keep US interest rates low, which in turn sustains American consumption.

 IS it wrong with a big deficit?

The imbalance goes hand in hand with huge indebtedness. At the end of last year, America’s net financial deficit – what Americans owe the rest of the world minus what the world owes to the US – amounted to nearly 30% of the country’s total output. The US must attract about $1.8bn in overseas money a day to compensate for the current account gap and maintain the dollar’s value, according to Bloomberg, the financial news agency.
Why does the US stick to a strong dollar policy?

Should the US explicitly abandon its traditional, strong dollar policy, there is a risk that people will drop dollars like a hot brick – why would Asian holders of dollars want to hang on to an asset declining in value? Currencies have a notorious tendency to plunge or soar in value because of the herd mentality of markets, so it is crucial to manage currency adjustments in an orderly fashion. As long as the decline of the US dollar is smooth, there is no problem. But if the dollar plummets, the world faces a full-blown currency crisis.

The impact of American Enterprise in US Economy :

The united state had in his history, many rich personality some most known was Vanderbilt, Rockefeller, or Donald trump. Those personality who have built one of the best enterprise in the world. The State of California is very dynamic, and many enterprise has his head office in there. Society like General Electric, Ford,IBM, had in American economy great impact, hire  a lot like other big companies, but these generate many revenues. Many, big societies doesn’t want to pay high taxes and don’t create much job at the same which is one of the cause of the huge debt America is facing now.Those enterprises have a great influence in the national Budget.
  

The American Economy had in several years, deferent tenure, and  many Presidents which have run that Country and had put in Practice deferent Program to save the Economy.Those programs, which have some of them,great success, others failed. An economy, which stayed, one of the best, during decades with a fluctuating currency rate.     

 Aime Nzouzi.

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