Sep 6, 2009

Recovery difficult in US as the unemployment rate climbs to 9.7

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The global financial crisis showed some signs of recovery after the crash in 2007 with some economies like Japan’s, slenderly coming out of the red, the economy has been stabilized and growth is returning to the economies but it will be a long and painful journey ahead reports say according to the analysts.

The financial markets failed as its rational expectations theory and some other spin offs- such as efficient market hypothesis and the financial derivatives up on which the financial Guru’s place their bets on lost out miserably, shattering the world’s financial system. The economic horizon is still uncertain and the recovery will be long, difficult and painful according to the media reports.

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A recent US report also indicated the Unemployment rate climbing to 9.7 in the United States, though the rate has increased, the number of lost jobs count has slowed down and the analysts predict the rate will further rise to 10.1 by the middle of the next year. It is a healthy sign but unemployment rate climbing, there is not the underlying fuel there for strong consumer spending which is vital for the recovery analysts predict.

All along people in the US lost 6.9 million jobs since the country’s economy went into recession in 2007.

And now, analysts in the US reported a 3 to 4 percent growth in the third quarter thereby pulling US out of the longest recession since World War II.

In Asia, China and India are leading the economic recovery despite the world economy slow down with both the economies posting growth, with the Chinese economy posting a growth of 7.9 percent during the May-June Period and India’s economy posted a healthy 6.1 growth.

So, for now the story of main recovery in the world economy is happening in Asia, with China and India leading the way.

Other related posts :

1.Are Computer based complex models responsible for the financial crisis
2. Barack Obama’s first news conference after the elections


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