Are You in for a Bankruptcy during Recession?
The following are Top Five News on Recession that might as well serve as symptoms that you are on your way to bankruptcy during recession.
A Drawn Out and Painful Recession
The US economy is reportedly entering a recession that is expected to be more drawn out and painful than other usual downturns. Furthermore, inflation pressures are expected to linger despite retrenchment efforts on consumer spending, as cited from data reported by The Conference Board.
As University’s Richard Curtin would have it, “”This is no ordinary recession. The aftereffects will last much longer than the typical downturn.”
The expectations index, as provided by the Conference Board, is reported to be currently flashing red. This is definitely alarming news, considering that it’s coming from something that’s been proven to be a strong predictor for the economy.
Bush: to Sign an Economic Stimulus Package
U.S. President George Bush announced that he would soon sign an economic stimulus package worth $152 billion into law. Approved by The House of Representatives and the Senate, the measure involves business incentives and tax rebates given out to stave off recession that is expected to come during the election-year.
“This bill reflects our principles. It is robust, it is pro-growth, it stimulates business investment and it puts money into the hands of American consumers,” Bush announced in a conference in Washington.
The legislation will provide rebates amounting at $1,200 for individuals and $1,200 for couples, with the addition of $300 for every child. $300 checks will be given to low-income people, disabled veterans and retirees who are on Social Security.
Consumer’s Confidence in the Economy Sinks Lower
Consumer’s confidence in the U.S. economy is now even lower, mainly because of fears caused by shrinking job opportunities and because of talks about a looming recession. As shown by data given by RBC Cash Index, confidence has dropped to 48.5, definitely lower than last month’s 56.3. Worse, this is the lowest since index reports began in 2002. This is happening in spite of efforts by Ben Bernanke, Chairman of Federal Reserve, to bolster the economy by inducing people to buy through lower interest rates. As a matter of fact, this is by far the most aggressive move the Fed has taken in over two decades, with interest rates slashed twice over in only eight days for the month of January.
Economic Fears Weigh Down Wall Street
The economic and credit fears dominant these days, amid talks of recession, is imminent at the Wall Street too, with investors shifting their courses into basic consumer utilities and staples, practically shying away from the technology sector and risky financial companies.
U.S. Economy is Stagnating
The economy seems to have been put on hold, with the number of people drawing on benefits for the jobless hitting at 2-1/4-year high, the housing market yet to reach the bottom and consumers spending much less.
Pending sales of homes is down from last year’s 2.4 percent to only 1.5 percent this year, as reported by the National Association of Realtors. The Labor Department, on the other hand, reports that the total number of workers relying on the benefit rolls for the jobless is at a record high ever seen since October 2005. As for the retail front, Target Corp and Wal-Mart stores Inc. have reported a pull-back on consumer spending, with sales during the last month much lower than forecasted by retailers.
With all these news proving that the U.S. economy may be in for trouble, you are left with one big question—will you or your business collapse under the economic strain?
Take note that these news came out on a single day—February 8, 2008. It might still be premature to confirm that the U.S. economy is experiencing recession. Still, you must start doing your own precautionary actions now!
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