With America finally getting a real break from its long drawn out recessional nightmare, there is an air of optimism apparent throughout world markets. Given that in July 2012, the superpower has encountered better-than-expected hiring – 163,000 – this has added fuel to the notion. As well as creating additional jobs, it has helped reduce fears about America’s economy in general.
But critics have suggested that these statistics are just that – statistics – which cannot be relied upon 100%. Other figures show that there has been an increase in the level of unemployment to 8.3 percent which contradicts the air of optimism created by the additional job openings in July. Still, it helped to soften the blow that less-than-positive comments made by Mario Draghi, President of the European Central Bank, made last week. But his words did leave room for some debate. True, he did shed disappointment on some market expectations, but, at the end of the day, investors look at it as opening the bond markets for potential additional investments.
There was a slight drop in oil at the beginning of last week too, but still, it wasn’t too great as to deflect from its previous high that was reported after America’s impressive employment growth. When the dollar is stronger, oil prices are often lowered and there is a greater sense of optimism vis-à-vis an improvement in the economy as a whole.
What is the good word from potential US president Mitt Romney? He believes America’s economy has to take “dramatic” measures to recover from its recession…still. It shouldn’t be resting on its laurels. But he doesn’t believe the method should be increased government. Rather “incentives and opportunities” should be created for all businesses, enabling them to increase their hiring capacity (as was already witnessed last month). In other words, the positive escalation in America’s hiring trend needs to continue.
To do this, Romney promotes a reduction in individual and corporate taxes; lowering of government expenditure and facilitating the regulations for energy companies which would result in the US becoming energy-independent by the year 2020. With this financial plan, he believes a further 12 million jobs would be created by the time he completes his four-year term. Conversely, Obama’s tax plan, Romney insists, would “kill jobs” due to tax increases. It is the middle class he argues – those who need to find jobs – who need the most help, as opposed to the wealthy who don’t require such assistance.
So, today, while certain figures indicate that America’s economy is well on the road to recovery and waving goodbye to recession, there is still much work that needs to be done to ensure this is a real trend – covering the entire economic spectrum – that will continue long-term.