Economics and Business
What was the 1990s boom?
It was the longest economic expansion in American history. According to accepted economic indicators, the boom began in March 1991, when the first President Bush was in office, and ended in March 2001, when President George W. Bush was in office. Eight years of the expansion were during the Clinton administration.
The hallmarks of the 1990s boom were the creation of almost 24 million jobs, or an average of 200,000 jobs a month; a national unemployment rate that dropped to around 4 percent for an extended period; productivity gains month over month; gross domestic product (GDP) growth month over month; unprecedented investment in the stock market (Wall Street added $10 trillion in wealth over the decade); a bull market fueled by $100 billion in initial public offerings (IPOs), many of them technology stocks; low interest rates; a low inflation rate averaging 2.6 percent per year; the elimination of the federal budget deficit; and the addition of dollars to the paychecks of many American workers. The last time the economy had seen similar indicators was during the 1960s. But in January 2000 the boom surpassed all others to become the longest sustained expansion in U.S. history.
Economists considered the factors that contributed to the boom. A Christian Science Monitor writer credited “a combination of ubiquitous American entrepreneurial spirit, massive amounts of technology, and a man named Greenspan.” But Alan Greenspan, the chairman of the Federal Reserve, which controls interest rates, credited information technology as the defining factor of “this special period”: “Its major contribution is to reduce the number of worker hours required to produce the nation’s output,” said Greenspan.
The boom ended in March 2001, along with the end of the dot-com bubble. The nation began a short recession, which ended November 2001, according to economic indicators. The economy then began a slow, and by most indicators, weak recovery.