How COVID-19 impacts the U.S. economy and predictions about the future

Abstract

The spread of COVID-19 is one of the most impactful global events in recent years. It has destroyed the U.S. economy and financial market. In just several months, the stock market experienced major fluctuations, the entire economy has basically stopped, and the unemployment rate peaked. Its severity even penetrated people’s daily lives; many are not getting basic requirements needed for survival. As cases increase daily, more and more are concerned with how the future will look like and what this pandemic will do to the economy in the long run. Faced with many uncertainties in macroeconomic trends and the continuous spreading of the virus, I have compared this current crisis with the subprime mortgage crisis in 2008. With a goal to reasonably forecast future developments of the U.S. economy, from both micro and macro perspectives, financial market trends and government actions have been analyzed. Specifically, the two events’ causes, essences, policies’ effectiveness, and other factors have been evaluated and suggestions in adjusting government policies have also been made. Unlike the 2008 crisis, this crisis will require longer, more complex, and more flexible processes and regulations to recover, and citizens should be prepared for this slow recovery. But overall, a promising outlook for the U.S. economy still stands in the long-run.