Question

Time period 1990-1999

I need an annotated bibliography with apa cited sources and formnat for recession in the 1990's which touches on GDP growth or not, unemployment, recession/inflation, international trade, currency valuation, fiscal policy by the government and monetary policy by the government.

Answer 1

A recession is a business cycle contraction which results in a general slowdown in economic activity.Macroeconomic indicators such as GDP (gross domestic product), investment spending, capacity utilization, household income, business profits, and inflation fall, while bankruptcies and the unemployment rate rise. In the United Kingdom, it is defined as a negative economic growth for two consecutive quarters.

GDP from the demand side:

Following very strong growth over the latter half of the 1990s, U.S. economic performance slowed in 2000 and tipped into a recession in 2001. During the 3-year period ending in mid-2003— a period including the bursting of the high-tech bubble, the terrorist attacks of 9/11, significant losses of stock market wealth, the continuing reports of corporate accounting scandals, and the wars in Iraq and Afghanistan—the economy struggled with below-trend growth, accompanied by a rising unemployment rate. During this period, consumer spending was moderate, inventory accumulation was slow, business investment was sluggish, foreign trade deficits were widening, and only defense spending was growing with any real strength. Following the second quarter of 2003, the U.S. economy once again began to grow more strongly, buoyed by Federal tax cuts, gains in household wealth, and growing optimism about the pace of business investment as well as continued strength in corporate profits. With real GDP growth at an average rate of 4.2 percent in 2004, it was sufficient to generate employment growth.

Unemployment :

The 1990–91 recession was followed by 9 successive years of economic expansion, resulting in year-to-year decreases in unemployment and increases in employment through the remainder of the 1990s. The civilian unemployment rate fell for 8 straight years, from 7.5 percent in 1992 to 4.0 percent in 2000, the lowest reading for that statistic in 30 years. Nonfarm payroll employment expanded by about 23.1 million persons over the 1992–2000 period.

Foreign trade

The trade deficit has widened and the current account deficit has deteriorated significantly in recent years. U.S. consumers continue to manifest high levels of demand for a wide range of manufactured goods that have been made in the United States in smaller quantities over the years. While exports of U.S. products to the rest of the world remains strong, they have been growing less rapidly than have U.S. imports for the past decade or so.

Monetary policy assumptions.

Between 1991 and 2003, the Federal Reserve Board cut the Federal funds rate 13 times, from a high of 6.5 percent to a 46-year low of 1 percent. The purpose of this almost unprecedented number of interest rate cuts was to fight the effects of the 2001 recession, the 9/11 terrorist attacks, the impacts of two wars, and the prolonged slow recovery of labor markets following the 2001 recession. Beginning in 2004, after the economy had enjoyed almost 10 years of economic expansion, accompanied by several straight months of job growth, the Federal Reserve shifted its monetary policy stance from “loose” to “neutral”a hypothetical level that neither stimulates nor impedes growth. The Federal Reserve has raised the funds rate 12 times, in .25-basis point increments, since late June 2004. This policy allowed the Federal Reserve to raise the rate from 1 percent to 4 percent the highest level in 4 years so that it could slow growth just enough to forestall inflation.

Fiscal policy:

The impacts of the Afghanistan and Iraqi wars and the costs of developing, funding, and deploying an effective homeland defense organization have served to push Federal defense spending sharply higher in 2004. The Defense Department’s current budget plan for the next 7 years embodies higher funding levels for defense spending than in any year since 1980. The defense budget has been designed to support the war on global terrorism, to restructure America’s Armed Forces, to develop a global defense posture, to field advanced war fighting capabilities, and to care for U.S. military and civilian.

Inflation :

Inflation slowed significantly during the 1990s and continued to grow very slowly until mid-2004. Since then, it has begun to show signs of acceleration, primarily in response to rising energy costs. The increase in interest rates by the Federal Reserve so far has managed to hold down demand-driven inflation, which might otherwise have accompanied the moderately robust economic growth over the recovery from the 2001 recession. Even with higher oil prices, a supply-based phenomenon, the economy has not yet seen major increases in the core rate of inflation2 and, over the longer term, BLS has assumed that the Federal Reserve’s monetary actions will continue to keep inflation within reasonable bounds