Yet despite leading the world’s economy for more than a hundred years, The US economy is now facing its greatest ever challenge since World War II. This challenge has been a result of both domestic and international factors.
Domestically, the US economy’s frailties were cruelly exposed during the 2008 financial crisis. The US economy has found it harder to recover from the 2008 financial crisis, believed to be the worst financial crisis since the Great Depression, as compared to previous downturns. Consumer confidence within the country is at all time low, perpetuating the slow economic growth since 2008.
On the international front, it is increasingly likely that the US will lose its status as the world’s largest economy. According to the latest IMF forecast done in April 2011, China is expected to overtake the US by 2016. This has come as a major surprise for the global community – previous forecasts had predicted China overtaking the US by 2035 at best.