Economics: 1990 - 1998

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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)

 

Unemployment Percentages 1990 - 1998



Occupational Category 1990 - 1997



Population 1990 and 2000



Income Levels 1990 and 2000



Sources: Recession Predictions, Census Scope, The Fact Book, Country Profiles 1990 - 1998


Industry Specifics
Prepared by Danelle  Howell

General Trends

  • “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)





*Note: data presented in both tables is in millions of dollars.










Sources: American Institute of Certified Public Accountants, Country Reports, Country Profiles, Apparel: A Brighter 1993, Apparel: Skie are Clearing, Retailing: Another Robust Year, Retailing: Outlook Slightly Overcast, Apparel: Ever Changing, Apparel: Multiple Problems, Apparel: Waiting for a Rebound, Retailing: Adjusting for Deflation, Retailing: Promotional Yet Upbeat, Retailing: Shambling Fashion Trends

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