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Inflation
Since 2008, the inflation rates have shot up and down but are currently stabilizing around 2 percent. In 2009, the average inflation rates was averaged to be -0.4; in 2013, the average inflation rate was averaged to be 1.5 . -
Interest Rates
Spring of 2008, the Committee reduced its target for the federal funds rate by a cumulative 325 basis points, leaving the target at 2 percent. This was because many people were unemployed. Therefore when they borrowed money, their interest rate was smaller so that they could afford to pay it back a little easier. (Picture shows that when interest rates go down, prices go up) -
Supply and Demand
Political instability in the Middle East caused concern about access to oil given that this region accounts for a large amount of the worlds oil supply. In July of 2008 oil prices reached over $136 a barrel due to global concerns about the wars in both Iraq and Afghanistan. Suppliers couldn't convince buyers that they could properly deliver the oil. -
Bonds
When the stock market crashed, people started to switch their money from stocks to bonds. Bonds are when you pay x amount of money to the government, and x amount of years later, that bond is worth what you paid originally. W/ interest rates, if you don't cash your bond, it'll be worth more than you paid for it. But, “there is no argument that interest rates will be going up. The only unknown is when it will happen. When it does, the prices of the bonds in bond funds will fall" then value drops. -
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Stocks hit all time low
Some of the stocks hit the worst they have been in years. There was a ratio of 50 to 1. -
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Monetary Policy
In 2009, Obama decides to print money in order to fix the economy by the use of the monetary policy, rather than the use of the fiscal policy where he would tax corporations and individulals. Due to the choice of printing money, the US dollar lost some of it’s value; thus, the prices of things rose. -
Trade Deficit
The U.S. trade deficit is when the total goods and services the U.S.imports is greater than the total it exports.A lower deficit means exports are starting to gain on imports. This is good for business, which will eventually create more U.S. jobs. America's dependence on foreign oil drives the trade deficit. In 2012, the U.S. imported $313 billion in petroleum-related products, up from $252 billion in 2010. -
Oil prices rise
Oil prices spiked to the highest they have been since 2008. They have fear that tensions with Iran have potential to disrupt the supplies source.
