The Wall Street Journal covers current events which are business focused and is published by Dow Jones & Company. One of the current events that the Wall Street Journal covers is the issue of the economy forecast. “Forecast See at Highest in more than Two Years” by Josh Zumbrun is one of the articles that is covered the Wall Street Journal, and it is the article that I selected. The main strategic issue that is covered by the article relates to WSJ survey that highlights the economic outlooks of the country in more than two years.
The Wall Street Journal survey in every month conducts a financial and business analysis of the estimates of gross domestic product, unemployment inflation as well as other key indicators of the economy. The survey they conducted as the article suggests shows that there is an average forecast for 2. 4% Gross Domestic Product (GDP) growth in the year 2017 and 2. 5% growth in the year 2018. The forecasters in this survey evaluate and assess various risks to their forecast, and they can conclude whether their forecast is a downside or upside.
That is, the main aim of the forecast is to assess whether the growth over performs or disappoints. The article indicates that Donald Trump election has economic forecasts of an upside risk which has not been a problem for a while. From the forecast, the article highlights that the survey showed that 64% of the respondents that the risk was to the upside which was the highest in over than two years and a reversal from the mood of recent years which was focused on potential risks from a global slowdown of the economic. Further, the article tackles the issue of the president regarding the economy of the state.
It states that it is hardly rare for the new presidents to have supercilious goals, but to confront various challenges in their policy implementation. The survey highlights that the economy affects various aspects of living such as employment levels, the GDP as well as the oil prices. The article provides an analysis of forecast of the economic growth which coincides with the theory of the course - business and management. The course helps to structure analysis of the information contained in the article as highlighted,also various aspects that affect the economy about forecasting which is vital in contemplating economic growth.
The forecast is important as it indicates the interest as well as the inflation rates for a certain period which helps in determining the unemployment rate. The upside risks in some cases could make the economy look much better than expected. These economic surprises can either be good or bad. The forecasters like economists in the Wall Street Journal survey have a concluded that it’s possible to either have a negative or positive growth in the economy. There various aspects that can cause the economy to do better that anticipated.
One of the aspects is consumer surprise which is the consumer spending. In the United States, the economy is driven by the manner in which the consumers spend. Consequently, the consumers might end up doing better thus raising the economy. There various suggestions which indicate that consumer surprise which includes an increase of salary though in a slower pace, home price recovery in most of the cities and soaring of the stock market. The other aspect that can boost the economy is the business investment revival.
For the last three consecutive quarters, there has been a slump in business investment in the United States. This is a result of the current political climate as well as the plunge in commodity prices which caused the United States oil producers to pull back the oil investments that were capital intensive. This as a result can boost the economy of the country. I would recommend policy changes to be implemented. The policy changes, in this case, refer to changes that could have a positive impact on the economy.
The policy change is in respect to the chief economist of Amherst Pierpont Securities who suggests that if policy changes are done in the right way, they could boost growth significantly. Further, the policy changes that could be implemented to boost growth include tax cuts for businesses as well as consumers, business-friendly regulatory changes and major spending on the infrastructure of the United States. If the top management team of the company implements the highlighted policy changes, they could boost the economy.