Economic Forecasting Paper Economic Forecasting Paper Bridgette Baehler, Elena Guzman, David Haynes, Adam Johnson, Anke Mahoney, Angela Villella Eco/372 November 26, 2012 John Ilokwu, Ph.D.
Economic Forecasting Paper Economic Forecasting Paper Introduction Economic forecasting is an important aspect of the financial world because it helpspeople understand how things may be in the future based on current and historical data. Manydifferent databases are available for finding out historical economic data and forecast theeconomic data for the future. Topics from this week are helpful when trying to understand thedata and can help with improving the economic future of our government and the companieswithin our country. This reflection will help us understand our strengths and weaknesses, andalso find the resources available for finding economic data to improve the economy. Historical Economic Data Resources The BEA (Bureau of Economic Analysis) produces independent budget analysis andeconomic issues to support congressional budget processes, and it also conducts objectivesimpartial to analysis. This source is valuable because it contains a large amount of valuableinformation in one place. There are different divisions that work together to foster collaborationand teamwork cross divisional to complete an accurate economic forecast. These includeNational, International, Regional, Industry, and Integrated Accounts all of which include nationalincome and product accounts (NIPAs), and the gross domestic product to name a few (U.S.Bureau of Economic Analysis 2012).
Economic Forecasting Paper Another possible resource is called FRED, or the Federal Reserve Economic Data. It is anonline database that consists of thousands of economic data from many different sources. FREDwas created and maintained now by the Research Department at the Federal Reserve Bank of St.Louis. The database goes beyond just providing data. It combines the data with other tools thatwill help the user understand, interact with, and display the data. This source is valuable becauseit not only gives the user information, but allows them to interact and create their own datastories. This can help the user read the data and understand what they are looking at. That is veryimportant because it can be hard to read economic data ("Economic Research - Federal ReserveBank of St. Louis", n.d.). Primary sources give you a more exact definition and measurement techniques, TheNational Bureau of Economic Research is a primary source and they are responsible forcollecting and maintain up-to-date data. NBER collect data for the United States and othercountries like Germany, France, and the United Kingdom. The NBER (National Bureau of Economic Research) is one of the resources that havebeen around a long time. It designed an extensive data set which covers pre-WWI economies andinterwar economies. The NBER also covers all areas of economics like production, construction,employment, money, foreign trade, asset market transactions and even government activity.
Economic Forecasting Paper Forecasting Economic Data Resources When forecasting economic data, one of resources that should be used is GDP (GrossDomestic Product). This resource is important because it is the overall dollar amount of goodsand product that has been produced within the country over a time period. The quantitative andqualitative factor are the faster the money moves throughout the country, the GDP will increaseproducing which will also increase quantities of product. Another good resource for forecasting economic data is to look at the unemployment rate.If the unemployment rate is high, the economy suffers because those that are unemployed haveless money to spend to stimulate the economy. If the unemployment rate is low, this means mostpeople are working and thus will have money to spend, stimulating the economy. Past trends canbe seen and future trends predicted simply by looking at the unemployment rate in the country. The impact of various factors on aggregate demand and supply. Many factors can have an impact on aggregate demand and supply. The distribution ofincome will affect it because when wages increase, people have more money and they tend toconsume more. This will cause consumption expenditures to increase. Another factor thatimpacts the aggregate demand and supply is foreign income. When foreign income rises, exportswill increase causing aggregate demand to increase. One last factor is monetary and fiscalpolicies. The government can spend money and adjust taxes in order to influence how consumerswill spend money.
Economic Forecasting Paper The effectiveness of changes in fiscal policies using Keynesian and Classical models. Keynesian policy can help fight inflation and stimulate the economy through differentpolicies that can be put in place. When using the classical point, this may take the country a longrun to make a turnover but gives the consumers the control rather than relying on the governmentto bail out the country. Topics Comfortable with The topics I felt comfortable with are the terms of GDP along with the differences ofunemployment. There are different types of unemployment such as a seasonal/temporary thatwill always be in account along with unemployment due to employees cut or hours reduceddepending on the economy. Topics Struggled With At the beginning I struggled with the fiscal policy. I now realize that it deals withgovernment spending and taxation throughout the economy. Before this can be done it has to gothrough Congress. The fiscal policy strives for full employment, stability of prices, and economicgrowth. Topics relation to field I have learned a lot in the Weeks Objectives. A portion of what has been learned is ableto be related into the field of work that I do. I understand and realize that unemployment is ahuge factor in this world today. I know that there are position available for those who want towork and will work hard in their position. I have learned that there are different types ofunemployment.
Economic Forecasting Paper The field of work I now work in which is Business and the office I work at there has onlybeen one type of unemployment. This type of unemployment is when employees get terminatedbecause of a reason which can lead all the way up to the lack of work and poor performance. Atprevious fields of work I have noticed that there is a lot of temporary unemployment. Thishappens to many employees at golf courses who are employed for a couple months of the seasonthen they can collect unemployment for the months that they are laid off due to the lack of workout of the golf season. Conclusion As we have determined, many resources exist for finding out historical economic dataand forecast the economic data for the future. Using these databases can help anyone understandwhat is going on in our economy and help determine what needs to be done to improve for thefuture. This class has been helpful with providing a lot of important information abouteconomics and how it can be used to understand our economy and what needs to be done tomake it better. There are struggles for every one of us, but this class will help us gain a betterunderstanding of economic terms and data.
Economic Forecasting Paper ReferencesColander, D. C. (2010). Macroeconomics (8th ed.). Boston, MA: McGraw-Hill/Irwin.Economic Research - Federal Reserve Bank of St. Louis. (n.d.). Retrieved from http://fredqa.stlouisfed.org/2012/06/19/what-is-fred/U.S. Bureau of Economic Analysis. (2012). U.S. Economic Accounts. Retrieved from http://www.bea.gov/index.htm.Library of Economics and Liberty (1999-2008) Retrieved from http://www.econlib.org/library/sitemap.html