The 90s Economy

The United States economy of the 1990s experienced the longest peacetime expansion in American history, fundamentally reshaping public expectations about growth, employment, and technological progress. The decade began in recession (July 1990 to March 1991) but subsequently produced 107 consecutive months of economic growth. Unemployment fell from 7.8% in June 1992 to 3.9% by April 2000—the lowest rate in 30 years. The federal budget, after decades of deficits, achieved surplus in fiscal year 1998, reaching $236 billion by 2000. The expansion was driven by several convergent factors: the commercialization of the internet, the personal computer revolution, a sustained rise in labor productivity, low inflation maintained by Federal Reserve Chairman Alan Greenspan's monetary policy, and strong consumer spending. The decade's prosperity was unevenly distributed, however, with income inequality widening even as overall wealth grew. The era culminated in the dot-com bubble, which peaked in March 2000 before its collapse erased trillions in market value.