Is the worst recession in 75 years actually over? Some signs are pointing to “yes.” According to a report from the Associated Press the economy grew last quarter. In a report released by the Commerce Department, the economy actually grew, ending a record streak of four quarters of decline. It was the first growth experienced in more than a year. Some say government aid and Federal support are what helped drive home and car sales– something that can’t continue forever.
President Obama called the growth “welcome news” but says there is still a long way to go since many Americans are still out of work. Plus their home values and 401(k)s still remain down. Many economists say the recovery won’t last for long as the impact of the government’s $787 billion spending package fades away. Even Obama’s chief economist believes that the stimulus spending has already had its biggest impact and probably won’t contribute to much growth in 2010. As for the unemployment rate, many experts believe that will continue to increase, too, pushing 10.5% next year before declining.
So what pushed the US into positive growth? Spending on housing was up for the first time since 2005, likely supported by the $8,000 tax credit for first-time buyers. Plus Federal government spending increased by 7.9% in the third quarter. But it’s up to the National Bureau of Economic Research to decide when and if they recession is truly over. They’re the group in charge of dating the beginning and ends of recessions.
So what do you think– is the recession over? Take our poll: