The U.S. Economy

President George W. Bush had the following to say about the economy on Wall Street in New York City Wednesday, Jan. 31, 2007.

"When people across the world look at America's economy what they see is low inflation, low unemployment, and the fastest growth of any major industrialized nation," said the President. "The entrepreneurial spirit is alive and well in the United States."

This statement speaks volumes about the current state of the economy in the United States. The three characteristics that the president mentioned are some of the most important factors in any formal economy. Each of these figures has a different and equally significant importance.

Keeping inflation low is important in any economy. If inflation is too high the value of the currency will decrease, prices will rise, and money shortages will occur. During the European hyperinflations of the early 90's several countries' economies were completely destroyed when the value of their money fell to near nothing. Unemployment level is also an important figure because it is usually an indicator of the strength of the economy. High umenplyment implies that the Fed is implementing a tight money policy and the money supply is low.