President Barack Obama aims to remind American citizens about the country’s economic u-turn that has occurred as he held office. If you remember in January 2009 people witnessed the free fall of the US economy wherein a lot of Americans lost their jobs and even their homes. Much of this turmoil was caused by a subprime lending problem and a housing bubble. Businesses, as well, went bankrupt and even the once thought invincible US auto companies and powerful US banking system required government bailouts.
Since the Great Depression, America had not witnessed such economic turmoil. However, since 2009 the country is pushing to overcome the debt challenges and Americans are looking for opportunities to grow their income-generating businesses and jobs back to prior 2008 numbers. In fact, according to hedge fund managers, the strides that America’s businesses have made since the economic depression were pretty amazing.
How Obama Managed Debt and other Economic Concerns
During President Obama’s initial months after taking office, the unemployment rate hit 10.3 percent but today, it is down by 5 percent (not considering the real numbers that include the number of people who gave up looking for work). 5 percent is considered a healthy normal rate according to most economists. Obama seen a total increase of more than 9.3million job opportunities to since he has taken office, how much of this can be contributed to his policies is unknown. After most economic contractions we tend to see a rebound. When it comes to small business debt, we have actually seen significant changes that entrepreneurs and small business owners took advantage of, despite not having access to new lines of credit.
However, the National Debt has clearly skyrocketed from Obama administration due to spending a lot of money on wars and a never ending quantitative easing of the currency, which was used to stimulate the declining economy. Lately, there is a significant decrease in deficit spending and last year, it has grown to $439 billion – the lowest increase yet compared to year 2007 figures. The overspending by the Obama administration and Congress through the years after taking the office has finally been added up. The GDP ratio debt has relatively increased from 48 percent (by the year Obama held office) to 75 percent (today).
As the Baby Boomers go to retire, concerns regarding the debt load of America is at the top of people’s minds. As a matter of fact, Standard and Poor’s relegated the US debt ranking in 2011. That being said, Obama is fortunate to be one of the few presidents in the history to finish his term with lower debt to GDP ratio compared to the time Clinton started his presidency. It is also important to note that household income is also down and actually lower than during the Bush administration. This means that the average middle class household is having a more troubling paying the bills and keeping up with currency changes created by quantitative easing, the additional printing and loaning of money from the Fed.
Are We Going to See More Successful Businesses in the US?
Meanwhile, there’s a valid reason why the dollar index has significantly risen by 25 percent after the previous 18 months. This had helped in reducing the price of oil and gas which small businesses and individuals benefit from the most. The American economy is apparently outperforming other developed countries in the world even though the country was debatably the epicenter of the financial crisis when due housing bubble and financial crisis after the Great Recession.
With the 9.8 percent deficit rating since he took office, Americans experienced the greatest deficit reduction along with the disbandment after World War II. Obama economic focus has been in specific sectors of the economy such as green energy projects, student loan reforms, climate change agreements and policies, and others. So far, we have seen significant changes under Obama administration and yet, our small business owners haven’t benefited from all the spending and are still hoping that their income will boost back to the prior Obama administration numbers in the coming years.