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EconNews Online is South-Western's service to provide summaries of the latest economics news stories. Review the brief summaries and, for stories of interest, select the full summary. |
| PRODUCTIVITY AND GROWTH | |
| Title | Brief Summary |
|
Survey Predicts Fast GDP Growth
Full Summary |
A survey conducted
by the Wall Street Journal predicts a strong growth rate for the U.S. economy
in the fourth quarter of 2003. The survey of 53 economists put the growth
rate at a seasonally adjusted 4.0 percent growth rate for the forth quarter. (Updated October 17, 2003) |
|
Overcapacity Hobbles U.S. Economy
Full Summary |
Manufacturing capacity
in the U.S. economy grew by more than 33 percent during the five years proceeding
the current recession, which started in . That is the largest expansion
of capacity in more than 50 years. Decreased demand due to the recent recession
has left the economy with a capacity glut, a condition that has hindered
the economy from obtaining sustainable economic growth as firms' money is
tied up in excess inventories rather than in capital expansion.. The overcapacity
appears to have reached its peak, and is now receding due to increasing
demand that comes with a growing economy. This new demand can be fulfilled
without more capital spending. (Updated October 17, 2003) |
|
Signs of Recovery
Full Summary |
Two key variables tracked
by economy watchers are consumer prices and industrial activity. Both have
shown signs of strength in recent weeks. Consumer prices rose modestly as
manufacturing activity increased by the largest amount since January. Increasing
production with modest price increases are viewed by analyst as a signal
of desirable economic growth. (Updated August 27, 2003) |
|
War is a Drag
Full Summary |
A war with Iraq could
end in a matter of days with little damage to Iraq's oil fields and few
casualties. Alternatively, the U.S. could be involved in a protracted battle
with terrorist retaliations in the U.S. Given the uncertainty over the severity
and budgetary impact of the war, it is not surprising that business firms
are reluctant at this time to commit to major investment projects. (Updated April 3, 2003) |
|
Starts, Stops and Stumbles
Full Summary |
According to the Commerce
Department, U.S. economic growth slowed considerably in the final three
months of 2002. Consumers, who had sustained the recovery throughout 2002,
turned cautious, and consumer spending rose at a 1 percent annual rate,
the smallest increase in a decade. (Updated April 3, 2003) |
|
Too Great Expectations?
Full Summary |
Consumer confidence
has plummeted since early 2000, aided by the dismal performance of the stock
market and the scandals plaguing corporate America. Unless the national
mood changes, or some major event like war with Iraq occurs, the economy
will likely muddle along. (Updated February 5, 2003) |
|
Argentina Shall Overcome?
Full Summary |
In December of 2001,
Argentina defaulted on almost all of its $141 billion debt, intensifying
an economic crisis that threw the country into the worst depression in its
history. But things are better today and many Argentines hope the modest
upturn can be transformed into a full-scale recovery. (Updated February 5, 2003) |
|
Moving Along
Full Summary |
The Commerce Department
reported its final estimate of third quarter growth in GDP was a 4% annual
increase. Evidence from the last months of 2002 suggests that spending has
slowed and a hoped-for Christmas surge in spending did not materialize.
(Updated February 5, 2003) |
|
Calculating the Uncertain
Full Summary |
The impact of a war
with Iraq on the U.S. economy would largely result from higher oil prices,
lowered stock prices, changes in consumer spending and federal government
spending. While economists are being asked to provide answers, there is
uncertainty concerning how the war will play out. (Updated October 10, 2002) |
|
Vacation Time
Full Summary |
A decline in average
hours worked annually per employee has hindered Europe's goal to become
the most competitive economy in the world. (Updated September 1, 2002) |
|
Totally Measured
Full Summary |
USA Today reports that
despite the recession, total factor productivity grew over this past year
and can play an important part in fueling the economic recovery. (Updated September 1, 2002) |
|
Amazing Gains
Full Summary |
The latest productivity
figures are evidence that the recession has not derailed the significant
trend in increased productivity that started in the mid-1990s. (Updated June 1, 2002) |
|
The Reality of Recovery
Full Summary |
The announcement of
a 5.8 percent spurt in GDP for the first quarter should have ended all worries
about the state of the economy, but many economists have not ceased worrying,
believing the economy is on shaky ground. (Updated June 1, 2002) |
|
Grading the IMF and World Bank
Full Summary |
In spite of staunch
political backing by the richer nations of the world, a vast amount of resources
both in terms of intellect and dollars, the IMF and the World Bank have
come under increasing criticism. Responding to their critics, both institutions
have been undertaking reforms. (Updated May 1, 2002) |
|
Switching Hands
Full Summary |
Prior to the events
of September 11, the Bush Administration had been critical of attempts by
government to interfere in financial markets. After the terrorist attack
and the precipitous decline in stock prices, Treasury Secretary O'Neil has
been urging investors to buy stocks. (Updated October 1, 2001) |
|
GDP Will Recover, But Will We?
Full Summary |
The destruction of September
11 was followed by one of the largest one-week losses in the stock market,
raising questions about the effect of the terrorist attacks on the economy.
One way to address these questions is to look at the economic impact of
natural disasters, such as hurricanes and earthquakes. The evidence is that
GDP quickly recovers. (Updated October 1, 2001) |
|
Productivity Gains
Full Summary |
The US Commerce Department
reported that the productivity of American workers rose in the second quarter
of 2001 at an annual rate of 2.5 percent. The increase in productivity compares
to a revised annual average of 2.6 percent for the 1997 to 2000 period.
(Updated September 1, 2001) |
|
The Economy Sputters
Full Summary |
The U. S. economy's
rate of economic growth in the second quarter of this year was 0.7 percent,
the lowest rate of expansion in more than eight years. Despite the slowdown,
the gross domestic product (GDP) did increase. (Updated September 1, 2001) |
|
Germany: You Are the Weakest Link!
Full Summary |
Europeans are concerned
that they will not be able to escape the worst effects of the U.S. slowdown,
and Germany is one of the major reasons for that concern. German economic
growth is forecast to be only 2 percent this year. (Updated June 1, 2001) |
|
The Times May Be Changing
Full Summary |
The Commerce Department
reported that the United States economy grew at its slowest rate in more
than five years in the fourth quarter of 2000. The gross domestic product
(GDP) grew at an annual rate of 1.4 percent during the quarter compared
with an estimated growth of 5 percent for the entire year. The Commerce
Department report is consistent with a U.S. economy verging on a slowdown
or a recession. (Updated March 1, 2001) |
|
Australia Goes for the Gold
Full Summary |
Without an equivalent
of a Silicon Valley, the Aussie economy has experienced a growth rate of
4 percent or more for the past 13 quarters. Productivity in Australia has
even surpassed the much- lauded U.S. figures. (Updated November 1, 2000) |
|
Will a Soft Landing Hurt?
Full Summary |
With more and more economic
data pointing to slower growth and moderate inflation, some economists believe
the Federal Reserve may have guided the economy to the desired soft landing.
While soft landing means that the economic growth has slowed without a recession,
it doesn't mean that unemployment will not increase. (Updated October 1, 2000) |
|
The Never Ending Story?
Full Summary |
The economy appears
to be shrugging off events such as ten-year high oil prices, giant trade
deficits and reputedly overvalued stocks, and worry about the magnitude
of the resulting downturn, and continues to extend each month the record
for economic expansions. The reason that the economy continues to grow despite
these seeming problems is worker productivity. (Updated October 1, 2000) |
|
How Do You Translate Soft?
Full Summary |
Since the early part
of last year when the Federal Reserve decided that supply and demand were
not balanced, there has been much discussion of a "soft landing." While
there is little controversy over the meaning of the term "landing," there
are differing beliefs as to what is meant by "soft." (Updated September 1, 2000) |
|
|
According to the Bureau
of Labor Statistics latest data for U.S. productivity, productivity growth
has slowed considerably compared to the last six months. A productivity
growth slowdown would create inflationary wage pressures. (Updated June 1, 2000) |
|
It Ain't Over 'Til It's Over
Full Summary |
The Japanese economy
expanded modestly in the first and second quarters of 1999, and Japanese
authorities thought their policies had caused an economic turnaround after
2 years of recession. However, the economy contracted during the last two
quarters, and two consecutive quarters of negative growth means that Japan's
recession has resumed. (Updated March 1, 2000) |
|
A Never Ending Story?
Full Summary |
The current economic
expansion does not as yet show any signs of faltering. Up until this year,
prevailing economic wisdom held that economic expansion is inevitably followed
by contraction. But Martin Baily, chairman of the President's Council of
Economic Advisers, stated "As long as we stick to sound policy, there's
no reason why it cannot continue indefinitely." (Updated March 1, 2000) |
|
Taking Stock
Full Summary |
The U.S. economy has
just completed its sixth straight year of economic growth averaging almost
4 percent. Based upon today's economic conditions, economists are providing
generally optimistic forecasts for the next few years. (Updated February 1, 2000) |
|
Leading? Lagging? Coincidental?
Full Summary |
The Conference Board
reported that the index of leading indicators fell in August for the first
time in four months, the index of coincident indicators rose 0.2 percent
in August, and the index of lagging indicators also increased 0.2 percent.
(Updated November 1, 1999) |
|
Savings in the Red - Again
Full Summary |
Americans are still
shopping! With personal income and stock prices continuing to rise, consumer
spending rose 0.7 percent in February - an increase that exceeded current
disposable income - making the personal savings rate negative. (Updated June 1, 1999) |
|
The Fed is Leaning
Full Summary |
Just when analysts were
beginning to think that the U.S. economy was evolving into an inflation-
and recession-proof economy, bad news burst that theory. The Consumer Price
Index (CPI) jumped 0.7 percent in April, one of the largest monthly gains
in quite a few years. (Updated June 1, 1999) |
|
Pleasing Productivity Path
Full Summary |
Federal Reserve Chairman
Alan Greenspan characterized the recent performance of the economy as "phenomenal".
The economy's strong growth, low inflation, low unemployment and strong
profits in the business sector are in large measure the result of strong
productivity growth - gains in productivity of this magnitude have not happened
since the beginning of 1983. (Updated June 1, 1999) |
|
The Dow at 10,000
Full Summary |
The headlines read,
"Dow Industrials Top 10,000". The extraordinary growth of the
Dow -- it has increased over 50% since December 1996 when Federal Reserve
Chairman Alan Greenspan warned of irrational exuberance -- has fueled economic
growth and created a great deal of personal wealth. (Updated May 1, 1999) |
|
GDP is Up, But...
Full Summary |
Gross Domestic Product
increased by 6 percent in the fourth quarter of 1998. This growth is impressive
given that the economy is an eight-year old expansion eight-years old. Not
everything is rosy however. (Updated May 1, 1999) |
|
Pleasing Progress of Productivity
Full Summary |
The Labor Department reported that
labor productivity, the amount that a worker produces in an hour of work,
rose at an annual rate of 3.7 percent in the fourth quarter of 1998. This
increase marks the third year of gains in the productivity measure and the
largest quarterly increase since the first quarter of 1996. (Updated March 1, 1999) |
|
A Proposal to Save
Full Summary |
Household savings in the United
States are significantly below the rate in other countries and have declined
in recent years. One-third of all families have no savings and another third
have less than $3,000 in savings. It is estimated that only 40 percent of
baby boomers will have enough savings to support their living standard at
retirement. Reduced savings not only affect individual families, but the
nation as a whole. Economic growth is dependent upon investment, which is
tied to savings. In order to stimulate savings, Senators Coverdell and Torricelli
have proposed a number of tax breaks. (Updated March 1, 1999) |
|
Rocky(?) Road to a Record
Full Summary |
Last year at about this time, economic
forecasters were predicting that economic growth for the U.S. economy would
slow. How accurate were these forecasts? (Updated February 1, 2000) |
|
A Growing Surprise
Full Summary |
The Commerce Department reported
that U.S. economic growth rose strongly for the third quarter of 1998. The
growth was higher than expected, as turmoil in world financial markets had
caused many analysts to predict a 3.3 percent increase. (Updated January 1, 1999) |
|
Savings Go South
Full Summary |
The negative savings rate coupled
with decreasing consumer confidence have caused some analysts to predict
a slowing in economic growth in the next few months. (Updated December 1, 1998) |
|
September Slack
Full Summary |
The Labor Department
has just reported that September job growth was at the lowest rate in over
two years. Unemployment also increased slightly. While the data provides
evidence that the global financial crisis is having an impact on the U.S.
economy, the U.S. economy is still very healthy. What the data does show
is that the risks of recession have increased. (Updated November 11, 1998) |
|
1997 Economic Vintage Rated Highly
Full Summary |
The Census Bureau reported
its findings concerning the performance of the economy in 1997. The Bureau
found that 1997 was a very good year -- household incomes rose at twice
the rate of inflation and the percentage of the population below the poverty
level fell.. (Updated October 15, 1998) |
|
Trouble Ahead?
Full Summary |
Asia's economic woes,
Russia's economic turmoil, the recent downturn in the stock market: add
these events together and the healthy economic picture of just a few months
ago begins to look less well. (Updated September 1, 1998) |
|
The Economy Cools
Full Summary |
The Commerce Department
reported that U.S. economic growth slowed sharply to a 1.4 percent annual
rate in the second quarter. (Updated September 1, 1998) |
|
Full Summary |
The US Commerce Department
reported that the productivity of American workers slackened in the first
quarter of 1998 to an annual rate of 1.1 percent. (Updated June 16, 1998) |
|
GDP Continues to Point Up
Full Summary |
The Commerce Department
recorded that Gross Domestic Product (GDP) increased at a 3.5% annual rate
for the third quarter of 1997. (Updated January 15, 1998) |
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