7. Why the US economy is weak

A typical recession lasts about a year and its followed by rapid expansion as firms rebuild inventories and consumers make up for delayed purchases. But not in the Great Recession. The rapid expansion never came, unemployment is still significantly higher than before the recession and the US economy is weak. Why? Because it is a financial recession brought about by housing and spending boom. US households are saving to reduce their debts (they are deleveraging and  consumer spending is weak. Since consumer spending is about 2/3 of US economy, without growing consumption the economy is sluggish.