Where will the US Economy be in 5 years?

Question

This is for my MacroEconomics final. Information on productivity, international trade and value of the American dollar. Also views on GDP and CPI will be helpful.

Answer 1

Go back to the late 19th. century and look at the parallels. If Teddy Roosevelt had not put an end (at least slowed down) the growth of what was later called fascism at that time, the nation would have collapsed. Today we ar in a similar situation but without the strong foundation of a manufacturing-based economy.

At the current rate, in 5 years the economy will be in a shambles due to insurmountable debt and the loss of domestic buying power.

Answer 2

Loan defaults are already driving a tail-spin in consumer buying power.

The first answer is probably on the mark, the second is political wishful thinking that goes along with the bush statement that he will have the national debt. paid down by 2012.

Unless he acts as the worst rumors suggest, he will not be in office in 2012. It is likely he will be outside the CONUS.

Answer 3

Ignore the nonsense above. Though economic growth will vary, and likely as not we'll be due for a stock market correction and a recession at some point over the next five years (just owing to typical historical averages), your best bet is to assume things will progress about as they are doing now.

1) Make no estimates about the value of the dollar -- that is impossible to predict and you have no basis for making a forecast.

2) We'll still have a substantial trade deficit, and it still will not have caused anything bad to happen

3) The GDP will be (in a real sense) about 15 - 20% larger.

4) With mild inflation the general price level will be about 12% higher.

5) Productivity growth will have averaged 2 - 3% per year.

6) The federal budget will be in it's 3rd or 4th year of surplus (unless we go into a recession prior to that). The public component of the national debt will have shrunk by several hundred billion dollars compared with today. But total debt will be higher owing to the Social Security surpluses (intragovernmental debt). In fact by then over 50% of the national debt will actually be the Social Security Trust Fund (which counts as debt).

EDIT: Hey you scrubs who give me all the thumbs down's. Why doncha print this off and then check back in 5 years. We'll see who's right and who's stupid.