While politicians and financial experts debate whether the American economy is in a recession, some local scholars say the economic outlook is so dismal it doesn’t matter what people call it.
“We haven’t seen numbers like this since the 1980s,” said Nathaniel Johnson, associate economics professor at Florida A&M University.
“Despite the definition of a recession, I feel the U.S. economy is in a recession.”
According to www.investopedia.com, a recession is defined as, “Two consecutive quarters of negative economics growth as measured by a country’s gross domestic product.”
The numbers spell bad news, said David Girton, executive vice president of SBK Brooks Investment Corp.
“With the rising concerns with the stock market, the lack of consumer confidence, the looming housing issues and its effects on the economy, the value of the U.S. dollar has weakened drastically over the past year,” Girton said.
In order to boost the sagging economy and generate consumer confidence and spending, the federal government must continue to be proactive with writing and instituting economic policies, said Girton.
In an attempt to stimulate the sagging economy, the Federal Reserve and the U.S government have taken aggressive measures by cutting interest rates and lowering the Fed funds rates. These cuts make it less expensive for banks to borrow money from each other. Girton argues for more government intervention.
“This is not enough,” he said.
Johnson agrees that cutting interest rates might help to turn the economy around.
“I feel like that it is a good thing that the Fed is aggressively trying to stimulate the economy and cutting rates is a good first step,” Johnson said.
“In order for consumers to feel confident with purchasing large ticket items, more needs to be done,” said Frederick Anderson, a graduating business major from Indianapolis.
“When looking for companies to start my career one of my biggest concern is job stability and to know that my job isn’t going to get outsourced over seas,” Anderson said. “I need to know how high gas prices will climb, and I need to know when our government will step in.”