The modern world still suffers from the aftermath of 2008 financial crisis that triggered recession of the economy and conditioned the appearance of a number of problems in the sphere of finances. The majority of the powerful states of the world were not able to avoid the negative impact of the crisis and suffered from the economic contraction and decrease in incomes. Yet, at the moment, the situation remains complicated as a number of stressors still exercise their influence on the economy and finances of a number of states. Unstable international situation and oscillations of oil prices might trigger the new wave of crisis (“Explaining low inflation. The lowdown” para. 2). Being one of the leading states, the USA might also suffer from it.
Besides, analyzing the state of the US economy, it is crucial to admit several factors. First, despite the oscillations of the oil prices, some essential indicators remain robust as new jobs are being added, and the housing market could be characterized by a certain stability (“Unfamiliar ways forward” para. 4).
At the same time, the decrease of the tempos of economic growth, failure of corporate profits and problems in the banking sector indicate the recession that might trigger another financial crisis (“Unfamiliar ways forward” para. 4). Moreover, the problems of the global economy, which suffers from the same issues, also have the pernicious impact on the USA, contributing to the deterioration of the situation in the sphere of finances.
The absence of stable markets and the decrease of the demand for a certain product undermine the financial stability of a state and promote the further deterioration of its economy. The existence of crucial problems is also evidenced by the anxiety of the leading financial markets and by the fall of stockmarket indexes (Mui, “Economists are starting to warn” para. 5).
However, the most threatening fact is that the government does not have many options to deal with it (Ritholz para. 3). It means that companies, corporations, and common people will have to survive alone. Nevertheless, there are still several steps that should be made to mitigate the negative effects of the recession. First, the government should obviously provide social guarantees to workers to bring unemployment down and decrease the tempos of inflation (Ritholz para. 6).
Second, the low oil prices make mining and manufacturing industries vulnerable (Mui, “U.S. economy adds ” para. 7). This sector is crucial for the whole US economy as it provides a number of jobs and guarantees the stable income (OBrien para. 5). In this regard, the government should introduce the monitoring of the given sphere to be able to respond to the slightest changes and support it in case of some significant problems.
Finally, the state should be ready to act in terms of financial crisis and use the funds to help the economy recover from the recession. Yet, a number of economists have the pessimistic perspective, stating that the government will not be able to cope with the new financial crisis. These assumptions are based on the previous experiences that demonstrated the inefficiency of the governmental steps made to change the situation.
Altogether, the current state of the world economy gives rise to a number of issues related to the possible development of the crisis. Speaking about the USA, it is possible to admit the first signs of recession, which means that the government should accept some programs to mitigate the negative effects and guarantee the further stable development of the economy. Only under these conditions, the state will be able to face the challenge and preserve positive tendencies in its economic sector.
Works Cited
Explaining low inflation. The lowdown. 2015. Web.
Mui, Ylan. “Economists are starting to warn about the risk of a new U.S. recession.” The Washington Post. 2015. Web.
—. “U.S. economy adds 215,000 jobs in March, jobless rate ticks up to 5 percent.” The Washington Post. 2016. Web.
OBrien, Matt. “The recovery is better than it’s ever been.” The Washington Post. 2016. Web.
Ritholz, Barry.”What are the chances of a recession? Not what you’d think.” The Washington Post. 2016. Web.
Unfamiliar ways forward. 2016. Web.