the State of the Economy in 2000
When the new year of 2000 hit, the economic growth that the country had been seeing throughout the 90’s and even before halted suddenly. Looking back, economists say the causes for such a slowdown were Middle East violence, higher oil prices, stock market decline, and how long the up cycle had lasted. The economic activity slowed more and consumer confidence continued to drop throughout the year, and something as bad as an economic recession looked possible. Actually, the economy was doing well in the start of 2000. The US was empowered by technology, and the economy had expanded by an amazing 5.6% when the middle of the year came. However, this worried economists about potential inflation. In May of 2000, the US Federal Reserve System, or Fed, enacted a .5% interest boost to hopefully help prevent this concern. However, the problems from interest and energy price increases from the late ‘90’s caught up with the 2000’s in the 3rd quarter, and GDP in the country was at only 2.2% and dropping even more.
|
Definition of GDP- |
HOW 9/11 IMPACTED THE ECONOMYNot only was 9/11 a tragic and monumental event in America’s social and political history, it was a financial disaster that would forever alter the climate of the economy and how it functioned. It would cause many other financial events later in the 21st century. The sudden loss of human life and businesses of all kinds caused the New York Stock Exchange to shut down for a few day, for only the third time in American history. No one can estimate the loss of economic potential of that day and beyond. Some guess at about at $60 billion plus in insurance only. Somewhere around 18.000 small businesses were destroyed or displaced due to the falling of the Twin Towers. It goes to show how much an event like this can affect an entire nation, even though the economy.
|