The economic crisis that hit US economy in the mid 2008 has now spread to other parts of the world and is continuing to gulp down credit markets and financial institutions worldwide. As per the economic analysis of the present year, the current state of the US Economy is expected to become worse than the last year and may prevail for a few more months ahead.
According to the stock market analysis of economists during the 56th annual economic conference held at the University of Michigan, the present US economy may hit bottom halfway into the year 2009 and the percentage of unemployment in the country is predicted to be of 8 %. If the condition prevails as such it is certain that the United Nation in the next 18 months shall drop about 2.4 million jobs from different companies. The rate of GDP is also predicted to experience pitiful fall of 1 % in the present year 2009 and may continue to fall further by 2 % in 2010. Although various important financial stimulus packages are introduced as a rescue measure, the condition may still be difficult to rise up. Altogether the overall outlook of the US economy shows that it may experience uncertainty. To increase liquidity to the markets, the Federal Reserve of US has implemented numerous measures to satisfy the demand of new homes because of which aggressive monetary and fiscal policies shall be introduced in the present year.
The US economy shows a pitiful downtrodden condition with the ongoing collapse of the domestic automobile industry and numerous companies that supply automobile parts. This browbeaten effect of the automobile industry offers profound economic crisis in the whole nation. As a result of lay-off in the automobile industry, unemployment is at its peak with the dismissal being 18,500 workers in Chrysler (Daimler News) and lesser percentage with Ford News and other popular automobile companies. Similarly lay-off is affecting other area of workers such as with Whirlpool (5,000), DHL (9,500), Yahoo (1,100), Citigroup (50, 000) and many more. In the same way the sinking of banks and other financial institutions are a common sight in the US where lay off of workers are still more critical than anywhere else.
Business investments are also experiencing a fall because of unemployment and cut spends. The oil prices that continue to drop are expected to show slow hike by the end of the year 2009- climbing to $107 a barrel. However, the petrol price is expected to remain in line as in 2008 and heating oil may rise to an average of $3.08 a gallon. The forecast revealed by blue chip shows the contraction of US economy by 0.4 % in 2009 and is predicted to fall to longer and deeper recession, though there are some areas of hope. With the current state of US economy, most economists predict an increase of 4 to 5 % for food and farm inventories in 2009.