At present, countries around the world are experiencing unprecedented economic difficulties. However, unlike other countries, the U.S. economy has shown strong resilience and growth against the trend. The U.S. economy grew 2.2 percent year-on-year in the first three quarters of 20235%, which is significantly higher than other developed and developing economies. This brilliant performance has put the U.S. economy, which was once in recession, back on its feet. So why has the U.S. economy been able to buck the trend?
1. The U.S. economy is growing at a relatively stable rate
In the context of the global economic downturn, the growth rate of the U.S. economy is relatively stable. Although the GDP growth rate of the United States is not advantageous compared with large developing economies such as India and China, the total economic output of the United States has increased significantly to 20 in the first three quarters of 2023 with the help of inflation, exchange rate and other factors278 trillion dollars, and the lead has actually expanded.
This relatively steady growth rate indicates that the U.S. economy has strong internal resilience and resilience. Despite the pressure of the global economic downturn, the United States has been able to maintain a healthy economic development trend through effective macroeconomic control and policy measures. At the same time, as the world's largest economy, the United States has strong market competitiveness and international influence, which also provides strong support for its economic growth.
2. The level of assets and savings of American residents is relatively high
The asset status of U.S. residents is one of the important factors supporting economic growth. According to statistics, as of June this year, the balance of deposits of American resident households and non-profit organizations was as high as 17$786 trillion, of which the balance of deposits of American residents is as high as 17056 trillion dollars, with an average deposit of 5$110,000.
This huge amount of savings provides the U.S. economy with a steady stream of spending power. Through their own savings, U.S. residents have injected sustained consumer demand into the economy. Whether it is to buy goods, make investments, or spend extravagantly, they are inseparable from the support of residents' savings. Especially during the pandemic, many people have put their savings into consumption, breathing new life into the economy. This not only stimulates the development of the consumer market, but also promotes the rapid growth of related industries.
3. The accumulated excess savings provide sustained consumption power for the economy
During the pandemic, U.S. households have accumulated a significant amount of excess savings. According to the San Francisco Fed, as of the end of September this year, U.S. households had accumulated about $430 billion in excess savings during the pandemic. These excess savings are expected to continue into the first half of 2024, providing continued support for U.S. private consumption over the next two to three quarters.
The accumulation of excess savings means that American residents have reduced consumer spending and saved more money during the pandemic. When the epidemic is gradually brought under control and social and economic activities gradually resume, these accumulated excess savings will become a continuous consumption driver. People can use these savings to buy daily necessities, travel, and entertainment activities, further fueling the economy's growth. This form of excess savings is not only conducive to the financial stability of individuals or families, but also provides support for the development of the entire economy.
4. The increase in investment has become an important engine of the economy
Investment plays a pivotal role in economic growth. In recent years, the United States has attached great importance to the promotion of investment, and has actively promoted economic development by expanding the scope of investment and increasing investment efforts. Various forms of investment, such as residential investment, equipment investment, intellectual property investment, and inventory investment, are contributing more and more to the U.S. GDP.
The United States** has adopted a series of policies and measures to encourage companies to increase their investment efforts. In the manufacturing sector in particular, the United States** has introduced a number of policies to encourage companies to return to the United States and increase local production and employment. These measures have not only improved the competitiveness of U.S. industry, but also injected a strong impetus into economic growth. At the same time, the United States has also included emerging industries in its strategic development plan to promote the strengthening of scientific and technological innovation and intellectual property investment. This investment expansion effect has further contributed to economic growth and development.
Considering the above factors, it is foreseeable that the US economy will maintain a strong growth momentum in the future. Compared to other developed and developing economies, the United States has a clear advantage in terms of economic size and growth. Although countries are generally facing economic growth pressures, the United States has been able to achieve relatively stable and strong growth in the context of the global economic downturn, thanks to stable consumer demand, accumulated excess savings and continuous increase in investment.
In 2022 in particular, the size of the U.S. economy has been revised upwards and has been affected by inflation, which has further boosted economic growth. This has made the momentum of the U.S. economy more resilient and continues to embark on a relatively stable and strong growth trajectory.
To sum up, the reason why the US economy has been able to grow against the trend is mainly due to the following factors: First, the high level of assets and savings of US residents has provided a solid foundation for economic development;Second, the accumulated excess savings provide a sustained consumption impetus for the economyThird, the increase in investment has become an important engine of the economy, promoting the expansion of economic scale and the improvement of growth rate. Based on the above factors, it is foreseeable that the US economy will maintain a strong growth momentum in the future and continue to become the world's only superpower.