Despite the US Treasury crying foul for all that it wants, the decision taken by the Standard & Poor’s to downgrade the top-notch credit rating by one notch and the ensuing plunge in the stock market are clear signs of loss of confidence and an assessment that is political and not economic. There is a small question about the technical capability of the United States of America to make a good decision about the debts but there is a big doubt in the minds of the experts about the political system of the nation to resolve the already existing financial problems and to get out of debt as soon as possible. The debt ceiling deal between the Congressional Republicans and President Obama could merely stave off the crisis of the confidence for the moment but does not really address the need to raise enough consciousness so that the nation doesn’t fall back into yet another recession. Most US economists are of the opinion that a double-dip recession is on the horizon due to the sour turn of every major economic indicator, but is this true? Read on.

Chances of the US economy to dip back into a recession – What are the possibilities?

Though it is going to be a scary time for most people, you need to analyze every particular issue that can speak about the credibility of the fact. This particular prediction varies by the forecasters but the standard range usually between 25 and 50%. There are some particular economists who are deliberately leading the entire pessimistic crowd by saying that there are more than better chances of the US headed for another recession. Especially when you look at the unemployment figure, the number of jobs that are generated, you can decipher the possibility of the US drifting to yet another recession. However, Jay Carney, the White House spokesman negates all such opinion by saying that there are no such threats of a double-dip recession.

What are the economic signs that are bothering almost everyone?

There are some particular economic signs that are worrying almost every citizen within the US. The signs of slow economic growth are one of the biggest things that are being considered as the most prominent reason for the nation sliding back into another recession. As per the reports of the Commerce Department, the expansion of the Gross Domestic Product was 1.4% in the 2^nd quarter of 2011 and 0.5% in the first. Service activity and manufacturing indices were down and consumer spending has also dropped. The massive cuts in the government budget are also wiping out some of the private sector gains, including a 38,000 job-drag in July, 2011. The Labor Department said that the US employment-to-population ratio or the percentage of work-age Americans who actually hold a job has recently dropped down to 59% in July and this is the lowest figure since 1983. This is deemed to be one of the scariest signs of the double-dip recession.

Every cloud has a silver lining – What’s the silver lining here?

Yes, there are some bright spots amidst all the negative news! The sagging expectations for growth are pushing up the global oil prices to their lowest level. The lower are the oil prices, the better will be the chances of consumers to step up their spending once again. Secondly, as the corporate profits remain high compared to the relative number of employees in the private sector, this will help the economy.

The US people lost the first decade of the 21^st century by borrowing money as if there’s no tomorrow and still run the risk of losing this decade to an economic stagnation. Experts recommend citizens not to panic and to hope for the best so that the US is saved from sleepwalking into yet another financial fiasco.

Jason Holmes is a regular writer with Debt Consolidation Care and is also a contributory writer with other financial sites. His expertise is woven around various aspects of the debt industry and with his e-books he tries to impart to people the different situations and simple solutions to get out of difficult situations. Some of his works include e-books like 'Credit Score The Quintessential Therapy for a Happy Pocket', Take Creditors and Collection Agencies to Small Claims Court' and, My Story- From Depression To a Smile'.