Bankruptcy

This Week in the Economy

By Chris Kramer

The week of the nation?s tax filing deadline saw some important financial news. Here?s a summary of what happened and what it might mean for you.

Recession?s End Unclear

The Business Cycle Dating Committee of the National Bureau of Economic Research, the group responsible for determining official start and end dates for recessions based on analysis of various economic indicators, announced this week that it cannot yet declare an end to the recession.

The press release indicates that, though many economic indicators have improved in recent months (including subprime mortgage defaults and retail sales), it is still too early to say whether or not the recession has officially ended.

Interestingly, though, one member of the committee disagreed with the committee?s final decision and issued a memo indicating as much, citing the following two indicators as primary reasons why he believes the recession has already ended:

• Real Gross Domestic Product (GDP), which measures the market value of all goods and services produced inside a country in a given year, has reportedly improved since June of 2009, from what?s called the ?trough;? and
• Real Gross Domestic Income (GDI) has also apparently improved, though not for so long a period ? the memo indicates it started its upswing in the final quarter of 2009.

He also notes that the economy?s recovery should not surprise anyone, suggesting that, because we ?fell? so hard, our ?bounce? back should be swift and forceful.

Unemployment Benefits Extension in Congress

Though some economic indicators may be on the upslope, unemployment still hovers close to 10 percent, meaning that millions of American families may not feel the recession?s end for a while.

But there may be hope for such families: a report from the New York Times notes that the Senate has voted 60 ? 40 in favor of extending unemployment benefits to out-of-work Americans.

The measure, should it pass both houses of Congress and get signed into law, would apparently cost somewhere in the neighborhood of $18 billion, which seems to be a point of contention for many Senate Republicans.

The (Higher) Future of Taxes

Newsweek reported this week that, thanks to serious budget deficits at the federal level and an aging American populace, there?s a good chance taxes will increase ? even sharply ? in coming years.

While this may not seem like the best news, take this year to enjoy your current tax level!

Full post as published by The Bankruptcy Blog on April 17, 2010 (boomark / email).