29
Oct

Economy grew 3rd quarter of 2009 But Recovery Could Be Temporary

Posted by Sara M. Varese

For the first time in more than a year, the U.S. economy has experienced a 3.5% growth in the 3rd quarter of 2009 due mainly to government aid, ranging from tax credits to homebuyers and rebates for auto purchases. However, because economic recoveries are fueled by consumer spending, this is expected to fade out as the government monetary aid dries up, discouraging consumer purchases.

What would make this growth seem less temporary and more stable are increased job creations or easier-to-get loans, not just the GDP growth which probably already hit its high point after the effects of the economic stimulus subsides.

U.S. exporting helped the local economy grow during the 3rd quarter because the cheap dollar has made it less expensive for foreign buyers to buy goods. U.S. exports increased about 21.4%, the most since 1996.

Employment still remains high at 9.8% and economists expect it to increase to 10.5 by the middle of next year.

So when will the recession end? This is determined by the National Bureau of Economic Research and usually doesn’t mark this point until well after the fact… so who knows, maybe things are getting better and maybe not.

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