Everybody has already heard the good news concerning an impressive economic growth in the US. Since 2008 the situation in the country was unstable so many people felt unsecured regarding their financial state. Needless to say that Great Recession has made huge impact on the American economy. Fortunately, the situation has finally changed into the better.
Banks are ready to lend big amounts of money both to private consumers and big corporations while Americans show their financial confidence. But it’s hard to say that everybody can take an advantage of solid economic growth. According to the report of Federal survey, almost half of Americans (47%) complain that their income is not enough to make ends meet so they borrow money and get loans to be able to stay afloat. Is American economic growth as solid as the Federal Reserve says?
Lending Services are Still in Big Demand
Economic recovery is a complicated process which needs to be analyzed from different points of views. Research managers investigating it say that despite some visible improvements it’s impossible to analyze exactly what’s happening in every American family.
Financial emergencies still make many consumers extremely vulnerable and these people have to turn to loan providers and ask for financial assistance to meet their expenses. The analysis found that if middle class people faced period when they hadn’t any income then 3 weeks would be enough for them to use all their savings. As for money management, during last 30 years most Americans spend the biggest part of their incomes for such things like health care, housing and insurance. After inflation consumers have faced a rise of their yearly expenses.
Like this, we can see a contrast between an economic progress and unstable situation of US households. Financial crisis of 2008 has seriously weakened American economy but after 7 years significant recovery has started. Within recent months we can watch an important improvement in the banking sector and other spheres of the economy. The unemployment rate has fallen down for 1.1% just for last year.
Federal officials have no doubt that such an economic growth is significant. But why so many American families don’t feel any consequences of this progress? It’s important to keep in mind that today central bank offers lowest interest rates for most popular credit products to stimulate economical improvement. The bank will try to keep rates low as long as it possible and in any case its increase will not be sweeping.
It’s also worth noticing that many Americans have low credit scores so when they face a need of emergency borrowing they apply to non-traditional lenders. Almost 56% of American consumers have credit scores which hardly allow them to get approved for traditional loans. More and more people turn to alternative lenders because of low credit and urgent need of money.
Trustworthy sources inform about a solid economic growth in the US and have many proves for that but why this growth is so invisible for low and middle class Americans? Despite all the facts and impressive figures of the statistics it’s hard to understand for who the economy is improving.