The U.S. economy is better off than it was in 2008, although you wouldn't know it from what you hear on television. It's a misperception that Dan Gross, co-host of The Daily Ticker and economics editor at Yahoo! Finance, aims to correct in his seventh book, "Better, Stronger, Faster."
Gross argues that the nation has bounced back from a near-death experience. However, many aspects of the economy continue to drag — most notably housing and jobs. While the housing sector may have hit bottom, "the U.S. has a very long way to go to make up for the lost ground in the economy," says Gross.
In an interview with The Daily Ticker's Aaron Task, Gross describes how the U.S. has transformed itself into one of the world's largest export-driven economies. Since hitting bottom in 2009, U.S. exports have grown 45 percent on a monthly basis, Gross says. The hundreds of thousands of manufacturing jobs that were shipped overseas severely blunted the manufacturing sector, yet a turnaround for the industry and American workers looks promising. The Institute for Supply Management reported that its index of U.S. manufacturing activity rose to 54.8 in April, the highest level since June 2011, as new orders, production and employment increased. Readings above 50 indicate expansion.
Gross traveled across the country, meeting with small business owners and executives in various industries and sectors to get a firsthand look at how businesses and individuals have adapted since the 2008 crisis.
After a "monumental amount of restructuring" in the private sector, Gross says it's clear that American companies have emerged more efficient, more productive and debt free. They're also better prepared to handle another economic calamity. The "too-big-to-fail" U.S. banks that were saved by government succor have accrued more than a $1 trillion of savings since 2008 — a record amount of cash holdings on corporate balance sheets. That money has yet to make its way down to the average worker who has seen his or her wages decline over the same time period.
The U.S. economy may be growing at a slower annual rate of 3 percent, but assertions that a Japan-like "lost decade" awaits the U.S. are false, Gross says.
"We had our lost decade from 1999 to 2009," he notes. "No net jobs were created, no gains in the stock market and no gains in the standard of living. We suffered a catastrophic fall. The economy is now larger than itspre-recession peak which no other advanced economy can say that."
The U.S. now adds $160 billion in new economy activity every quarter and $1.33 billion every day, according to Gross, real proof that fears of an American decline are greatly exaggerated.
The U.S. economy may still be finding its footing after one of the worst economic downturns since the Great Depression but Gross says there are plenty of reasons to be optimistic about America's future.
Better, Stronger, Faster: The Myth of American Decline and the Rise of a New Economy, is now available for sale.
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