The United States Economy
The United States of America's economy is one of the most powerful in the world. The GDP of the United States demonstrates the country's economic strength. In 2015 and 2016, the United States of America's Real GDP was $16.49 trillion and $16.73 trillion, respectively.
Growth Rate Calculation
The Growth Rate is calculated as [(Real GDP of 2016 - Real GDP of 2015) / Real GDP of 2015] * 100. As a result, the GDP growth rate in the United States is [(16.73 - 16.49) / 16.49] * 100 = 1.46%.
Economic Stagnation
The data on the current GDP growth rate of the United States of America affirms that the US economy is facing economic stagnation. The economy is growing at a relatively slower pace that can be attributed to the decrease in manufacturing and lack of resilience in the markets to weather from the effects of the recession.
Notably, the stagnation of the economy of the United States can be traced to the increased focus on the service industry and stringent economic policies that have forced some US firms to set base in other countries such as Mexico and China. The stagnating trend can be used to affirm that the US economy is more consumer-oriented since less manufacturing activities are taking place in the country (Kim & Heshmati, 2014).
The stagnation of the US economy can further be related to lack of congruence in the financial markets and the real economy. Fed has been criticized for offering monetary assistance to stabilize the price of assets and regulate the real industry boom, a decision that has not led to the intended result as the price of assets are affected by the demand and supply forces, and financial assistance offers negligible impact.
Reference
Kim, T.-Y., & Heshmati, A. (2014). Economic growth: The new perspectives for theory and policy. Berlin, Springer.
