Economic expansion is evidenced by real growth in gross domestic product and the consistent decline in unemployment rates since 1992. Productivity continues to accelerate as businesses invest more in labor and capital to improve modes of production.
Inflation is low and financial markets are robust.
The result has been a continued reduction in interest rates that has made the cost of borrowing less expensive for the business community. This is a general trend that is favorable to those seeking debt capital. However, the borrower still must possess the necessary financial strength or collateral to obtain the funding and benefit from the lower rates. While this is a positive environment for business activity, signs of stronger growth may eventually lead to higher costs of borrowing. Clear signs of growth may lead to a tightening of monetary policy by the Fed through raising interest rates in an effort to head off inflation.