Comfortable Feathers

Following is a break down of important findings for the years 1990 - 1998.

The State of the Economy
Prepared by Lindsey Crane

Important Highlights by Year

1990

• Recession begins.
• Start of the Gulf War

1991

• Recession continues.
• The Gulf War ends.

1992

• Federal budget peaked at $290,000.
• The federal budget shrank as economic growth increased tax revenues.
• Official end of the Cold War.
• Clinton wins presidency (many believe he beat out Bush Sr. due to his claim not to raise taxs).

1993

• Use of the Internet grows exponentially.
• World Trade Center (WTO) bombed.
• The Senate Ethics Committee censures California Senator Alan Cranston for his participation with Charles Keating in the Savings Loan Scandal. The Scandal cost the U.S. government between $125 - $150 to bail out the failed institutions.

1994

• The North American Free Trade Agreement (NAFTA) goes into effect, creating a free trade zone between Canada, the United States and Mexico.
• President Bill Clinton signs the Assault Weapons Ban, which bans the use of weapons for ten years.

1995

• The World Trade Organization (WTO) is created, replacing the General Agreement on Tariffs and Trade (GATT) formed from a series of post-war treaties on trade. The WTO is more highly structured than the previous GATT and counted 76 nations among its members in 1995.
• President Bill Clinton invokes emergency powers to extend a $20 trillion loan to Mexico to avert a financial disaster that had begun on December 19, 1994 during a planned exchange rate correction between the Mexican peso and American dollar.

1996

• A speech by the Federal Reserve Board Chairman Alan Greenspan suggests that "irrational exuberance" may be causing the extraordinary run up of stock prices.

1997

• The NATO alliance expands into eastern Europe when it extends an invitation to the Czech Republic, Hungary and Poland to join the alliance in 1999.

1998

• The United States Congress passes legislation, the "Iraq Liberation Act" that states the U.S. wants to remove Saddam Hussein from power and replace it with a democracy.

Sources: The 1990s, Expansion, 1990s Timeline, America's History, Country Profiles 1990 - 1998


Employment/Unemployment, Labor Markets, Population, Income Levels
Prepared by Danielle Hickman

Important Highlights by Year

1990

• Job creation turned negative after the recession began. 
• The yield curve inverted in mid-1989, predicting the onset of an economic recession (inverted yield curves are generally rare, and are highly correlated with recession).

1991

• Recession continues.

1992

• Unemployment hit a high point at 7.3%.
• Thought to be attributed to the "discouraged worker" effect (individuals were having a hard time finding jobs, and thus stopped trying).

1993

• Higher high school drop out rate, lower employment prospects.

1994

• Unemployment fell below 6%.
• Income for advanced degree is 50% higher than a bachelor's degree.

1995

• 31% of population is 25 - 44 years old (largest percent of total population).

1996

• 81.7% of population has completed high school.

1997

• Unemployment percentage continues to drop.
• Personal income increases.

1998

• Unemployment percentage continues to drop.

Graphs and Tables (Click to view larger)

 

• “Reverse snob appeal” and “value” are the catchphrases of the decade.
• Consumers are fascinated with bargain hunting rather than purchasing the expensive designer labels.
• Basics, such as jeans, T-shirts, and activewear, are big sellers.
• Discount stores gain incredible popularity.
• Wal-Mart is the top general merchandise retailer from 1990-1998.
• E-commerce gains strength.
• $3.5 billion sales earned for 1998 holiday season alone.
• Consumer interests, particularly Baby Boomers, shift their interests away from clothing and towards durable goods.

Important Highlights by Year

1990

• Consumer sentiment falls more sharply between July and September than in any such period since 1946.

1992

• Discount stores see sales jump of 10.2%.
• In October, consumer sentiment rises to highest point since mid-1991.

1993

• North American Free Trade Agreement (NAFTA) enacted.

1994

• Raw materials, particularly cotton, increase in cost.

1996

• Price decline caused by shifts in consumer interest, lack of consumer interest, surplus of stores, and globalization.

1998

• Internet Tax Freedom Act enacted -- will allow states to tax Internet

Graphs and Tables (Click to view larger)