1. U.S. Economic Performance
GOVT 2305, Module 1

2. U.S. GDP Growth Rate Since 2007
What happened in ?
The Great Recession
Recovery
What is the period of growth after a recession called?

3. GDP growth for the second quarter 2016 was 1.2 %.

4. What is amusing about the sign?
Recession
An economic slowdown characterized by declining economic output and rising unemployment.
Data indicators for recession include GDP growth and unemployment.

5. Depression
A severe and prolonged drop in economic activity.

6. Household Income Since 2000
The Great Recession has ended, but household income has not fully recovered.
Household Income Since 2000

7. Unemployment Rate Since 2008
The June 2016 unemployment rate was 4.7 %. .

8. The employment rate has not recovered from the Recession.
Labor Participation

9. Corporate profits have more than recovered from the Great Recession and are growing more rapidly than the nation’s economy.
Corporate Profits

10. Employee earnings have not recovered
Employee earnings have not recovered. Corporate profits are up but they have not been passed along to the workers.
Wages

11. CEO Pay

12. Dow Jones Industrial Average
What is this chart measuring?
The stock market has more than recovered. At the end of August 2016, the market stood at 18,503.
The Dow Jones measures stock prices.
Dow Jones Industrial Average

13. Low because of reduced demand for goods, services, and labor
Inflation
A general increase in prices and wages, diminished purchasing power of the currency
Would you expect inflation to be high or low during a recession? Why?
Low because of reduced demand for goods, services, and labor

14. The current inflation rate is below 1 percent.
CPI = consumer price index
RPI = retail price index
Most economists believe that a healthy economy has a modest unemployment rate of 5 percent or less and a moderate inflation rate of less than 5 percent.
The current inflation rate is below 1 percent.

15. What is a recession. What economic indicators point to recession
What is a recession? What economic indicators point to recession? What is a depression?
How has the U.S. economy performed in terms of GDP growth, household income, unemployment rate, employment rate, corporate profits, CEO pay, stock market averages, and wages?
What is inflation? Is the current inflation rate relatively high or low?
What You Have Learned