Luke Persichetti on the Economic Outlook for the United States 1

Melissa is a mother of 2, lives in Utah, and writes for a multitude of sites. She is currently the EIC of and writes about health, wellness, and business topics.

After the 2008 downturn in the economy, people have slowly developed an underlying paranoia that makes them skeptical about the market’s current status. In other words, even when everything seems to be going well, skeptics are looking for the signs of collapse. And rightly so. After all, losing enormous amounts of money almost overnight is not something that one can simply get over.

Fortunately, the current state of the economy is improving at a pace that might just turn the skeptical crowds into believers once more. In order to get there, however, one should take a look at some of the most recent developments and how they impacted everything from prices to take-home salaries.

Changes in Taxation

According to a Yale graduate with a background in finance and trading, Luke Persichetti, the somewhat recent changes in tax laws have led to a series of events that affected the nation. Originally, the goal here was to lower the cumulative tax rates and help people keep more of their salaries. Expectedly, letting everyone pay less in taxes every year does indeed leave them with a larger chunk of their own money.

This further causes them to put that money back into the economy by making unplanned and impulse purchases, or at least this is the theory. So, although the economy is profiting, the number of irresponsible buying decisions also increases. Nevertheless, it creates a more stable marketplace as there is an abundance of capital changing hands.

The Unemployment Rate

Making any type of forecast about the economy of the United States is impossible absent an overview of the current unemployment rate. Why? Because this single number has an enormous amount of data behind it and represents the percentage of the population that is gainfully employed. Currently, it stands around 3.6 percent and is one of the lowest unemployment rates in the history of the nation. Well, expectedly, more people working is going to contribute to a higher gross domestic product and average take-home income. Consequently, people will not struggle to make ends meet as much and their bills will be paid in a timely manner.

Growth of New Assets

The year of 2017 was one of the rare time periods when the entire market seemed to jump on-board with a certain trend. In this case, that trend was Bitcoin and other cryptocurrencies that introduced a new payment system and a unique store-of-value asset. As far as the reason for the uniqueness, it stems from the fact that Bitcoin grew by nearly $20,000 in less than a single year. This means that people who were quick to recognize their gains made more money in one year than a lot of investors make in a decade. Expectedly, that money got placed back into the economy and caused it to go into overdrive.

Since 2017, unfortunately, not everything has been so lucky in the spheres of cryptocurrency. During 2018, the price of almost every digital coin fell by over two-thirds. Some theories claim that this is just a temporary setback that is already on its way to improvement. For instance, Bitcoin just crossed $8,000 in price per coin, which was a price not seen its surge in 2017. Thus, the minor economic issues related to digital assets seem to be in the past as the market prepares for new aggressive gains that will help people amplify their income.

Long-Term Expectations

Although a lot of fields are currently focusing on the positive changes, there is an underlying need to think about the long-term future as well. For instance, the 2020 presidential election will cause another uproar around the nation. If one is to expect the same behavior as seen in 2016, this means that the stock markets will experience some temporary losses. So, the election could facilitate an atmosphere in which emotions are running high and buying decisions are not as rational. Nevertheless, no major consequences are expected to take place here as the election will not singlehandedly throw the American market in a downward spiral.

Besides the election, long-term expectations are also directly related to the international dealings between allied countries. For instance, the current tariffs that are still getting passed between the U.S. and China cause people to succumb to debt. How? Well, they make it much harder for sole proprietors like farmers and other producers to ship their goods and earn a decent living. As a consequence, they may require more subsidies from the government. The problem, however, is the fact that the government is limited to how many subsidies it can give out. So, these individuals may need to find loans to help them stay afloat. This, of course, puts more strain on their business models and may result in an unprofitable dry spell that is hard to recover from.