Tuesday, March 19, 2013

2013 Global Economic Forecast

By: Mason G.
The growth of the economy during the 2013 year is expected to be relatively weak like the growth of the past few years. The overall growth for the economy is expected to be around a 3 percent increase from last year. Even though this is a very small increase, every little bit is going to help and it is a step in the right direction after many years where the economy didn’t improve but actually ended up going the exact opposite direction. During the 2012 year the US economy improved by 2 percent so the annual averages will be fairly similar. To compare the US with another country to see where we are compared to everyone else, China’s economy has been on the rise for longer than ours and their economy is also doing better than our with about an 8 percent increase expected during 2013. The year 2013 is supposed to start off slow and not so good in terms of the economy but then more towards the middle of the year the economy is going to start to turn around. Also, in 2013, the housing market is expected to improve greatly. The housing market is just what it sounds like and that is just the general market of houses being purchased. In the past few years house prices have been way low and many people were losing money. Also because people didn’t want to sell their house not many houses were available to be bought. Thing are supposed to be much different for this next year when it comes to buying and selling houses. It is expected that more people are just going to want to buy a new home and sell their old house. Also, there is not many people at all that are building new homes. Experts say that the number of homes being built now is very far below what they want and far below what is healthy for the economy. The main reason why the housing market has been down the past few years is because houses were overbuilt from the years 2000-2007 so now there are too many. Finally we are catching up with it now. There are also younger couples looking to start a new household which is helping diminish the number of those excess houses. Experts are expecting that the average price of houses will increase about 3 or 4 percent in the next year. In the end, 2013 is going to feel a little bit friendlier than 2012 and a few years before that as well. Many experts are very optimistic with this upcoming year whether it be just the overall economy or the price of homes increasing or just the housing market. This is a very good step in the right direction for our country because we have really been faced with a harsh recession for the past few years now and it will be nice for thing to finally start to turn around.

7 comments:

  1. Finally - even as small as 3% increase - our economy is arising again. Our country has been in the downfall for a while, and the recession seemed to last 100 years. I believe that because the housing will improve as well, this will overall help with the economy. It is good to compare ourselves with China because then we can sneak into the future to see how we can overcome this recession ourselves. USA is one of the most successful countries in the world, therefore one would think we should have one of the most successful economies as well, right? Well I think that countries have their golden years along with some dark days. Eventually when we come out of this mess, we can hopefully prosper again, and our economy will thrive. Hopefully even by a 3% increase, a better economy is well on its way!

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  2. I agree with Joanie, the 3% increase is a huge increase if you look at the past years of the economy, which has been continuously dropping lower and lower. Any time the economy goes up its something to be proud of. If we continue to go up by 3% percent every year it will become a very large increase. Yes it will take a long time, but I feel a 3% increase every year would be getting somewhere.

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  3. It's good to see that our economy is rising, although 2% doesn't seem like a lot I'll take a minor increase over a decrease any day. I read about how China's economy is growing rapidly and how they are catching up to us in amount of oil consumed each year, which is extremely shocking. Their economy is doing great and hopefully ours will be on the kind of increase there's is, someday. I can see how over-building houses can be a big negative in our economy, because it's affecting the builders and the consumers of homes. It leaves a large surplus of homes, which means there isn't a lot of demand as it is. Now we have just vacant homes taking up space, and with the economy doing so poor recently, no one wants to buy any houses. It's good to see that economists are optimistic about the upcoming years, this could mean great things for America. We'll see how it pans out until then.

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  4. Clearly the predictions for a 3% increase are not exactly what the American people or markets around the world were hoping for; however, not even the most skilled economist can predict what the economy in 2013 will because the future very rarely is a exact replica of the past. The housing market sounds like it is continually growing, even if it is very slowly. Those people that had countless dollars tied up in real estate years ago will never be able to recover, but trust in the market again is all that we can hope for. In reality the market is a reflection on the consumers trust and willingness to take a risk, because the economy begins and ends with the America people. It will be interesting to see what unfolds in 2013 as we still attempt to recover from the market down fall just a few short years ago.
    - Collin Sternad

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  5. The future looks a little sad for the American people, expecting a 3% increase in our economy isn't much growth, but the fact of the matter is that hopefully we'll be able to build off this 3% and slowly increase it over time. Maybe we should take notes from other countries (China) with a 8% increase predicted for 2013 maybe there doing something right. However I think the small parts of the economy should be worked on first to build up our overall economy like the housing market, that was a great example. If simple stuff like that starts raising over time and becomes stable then other parts of the economy can slowly do the same and eventually will cause a overall increase in % over the years. Although it seems there is a lot of growth to happen it will come in time we just have to keep working at it, but like the example noted in this post the past years we have been going in the exact OPPOSITE direction and if that happens again it could mean big trouble.

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  6. Even though the market is not targeted to grow much, any improvement is better than none. While a 3 percent increase does not seem like much, the more gains we make the better our economy will be. China may be ahead of us but, it does not mean they may have a recession and be in the place we were a few years ago. We should not be comparing ourselves at this point to other countries though because we do need to grow a lot to be back to where we were in previous years. I also think that it is not horrible that new houses cannot be built. There are so many homes that still need to be filled and builders should focus on selling those first. The builders can make their money back and hopefully receive a profit which will allow them to go off and build more when the time is right.

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  7. Mason, I'm glad you talked about the housing market as this is something I believe to be a great indicator in the economy. Obviously, when the people are not buying houses, we can assume that the economy as a whole is under performing as people do not have the marginal propensity to consume. Likewise, when we see people buying houses, or at least have the propensity to buy houses, it is a clear indicator that the economy is going to be improving even though, as you point out, the numbers aren't quite there yet. When it comes to the housing market, typically, when people are buying houses, not only do they have the desire to buy, but also, the have the vitally important consumer confidence in taking out a loan with the intended ability to pay it off. The fact that people are willing to take on debit is a great sign of an improving economic climate.

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