All eyes and ears have been fixed on the economy for quite some time now. Many think that Barack Obama will turn things right around as soon as he takes office. However, even he is not so sure. But, despite the economic signs of 2008, 2009 is expected to be a much better year. Here’s why.
Decreasing Oil Prices
Do you remember when oil hit $147 per barrel? It wasn’t that long ago. Currently, oil is only about $45 per barrel. Global demand for oil has dropped significantly. Gas prices are currently $1.61 per gallon around the country. Some experts think that the price of a gallon of fuel will soon drop to only $1 per gallon. Oil prices weren’t nearly this low at the beginning of 2008. It is a great sign that gas prices have dropped so significantly.
Mortgage Rates
Mortgage rates are falling as fast, if not faster, than energy prices. The Federal Reserve has pledged to purchase millions of dollars in mortgage securities. Thus, mortgage rates continue to fall. The average rate for a new mortgage loan is now only 5.26%. Economic prosperity is in the forecast for 2009 thanks to falling mortgage rates.
The Federal Reserve
The Federal Reserve has been working tirelessly to get this country’s finances back on track. The Federal Reserve has pledged to do anything to “strengthen the economy.” Short term interest rates have already been pushed close to 0%. The actions of the Federal Reserve have gone a long way in preserving and restoring the United States’ economic situation.
Barack Obama’s Stimulus Plan
The Obama administration plans on spending between $750 billion and $1 trillion over the course of the next two years. Most of this money will be spent on rebuilding American infrastructure. This would include everything from green technology to transportation and beyond. Millions of jobs will also be created. Barack Obama’s revised stimulus package is credited with helping to get the economy back on track.
Deep Fundamentals
America is still considered to be a leader when it comes to fundamental strength. Innovation, a flexible labor market and higher education are ranked among the highest of America’s strengths.
When it comes down to it, America is in better shape than everyone thinks. We are certainly doing better than we were back in the 70′s. America has overcome many challenges in 2008 and is expected to do so again in 2009.
