Economic slowdown shortens U.S. Service sector by Zuzana Zelenakova

Though Federal Reserve tried to prevent USA economy from slumping into recession by cutting interest rates several times the attempt failed. It became obvious after the U.S. service sector, that means its banks, travel companies, stores and others, contracted on Tuesday for the first time in almost five years. For the investors it was bad news as they started to believe that the Fed's move saved the situation. But they figured it out and chose the safety of government backed projects. That resulted in stocks decline and bonds increase. Analysts predict January will be marked in the future as the beginning of the recession and guess how severe it will be. It does not matter whether it is moving company, clothing store, restaurant, water park or holiday resort. They have all experienced the drop in business. In particular, they were forced to cut jobs. In simple words, the U.S. economy has several problems, falling stocks market, high oil prices, stiffer competition, slow sales and lower customer demand. Ordinary citizens feel the impact too. Ryan Kaminski, 31 who owns a Mexican restaurant said the customers are fewer now and it gets worse every day. This year' sales have have fallen by 15 percent as compared to the previous year. Mr. Kaminsky said he and his family had to cut their expenses too. "We've cut out eating out and we didn't go on vacation last year. It's getting bad."

related story: http://news.yahoo.com/s/ap/20080205/ap_on_bi_ge/economy;_ylt=AkkdE5lioRkJA4iDvI9343qs0NUE

by Zuzana Zelenakova for PocketNews (http://pocketnews.tv)

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Edited by: Katarina Bosanska