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OPEC Oil Embargo
Pushed energy prices higher at fast rates and created shortages. Even after the embargo ended the affects continued to show. Energy prices stayed high adding to inflation and to growing unemployment rates. -
Wage-price controls
President Nixon instituted wage-price controls. These ended up keeping prices too high which reduced demand. The control on wages made them too high which caused businesses to lay off many workers. -
Time of Economic Stagflation
During the late 1970s the United States Economy was in a state of stagflation- an economic condition of both continuing inflation and stagnant business activity, together with an increasing unemployment rate. Inflation fed on itself with people buying more goods since they expected the prices to raise, which increased the demand for the products which pushed the prices to raise. This led to people wanting higher wages which caused the prices to increase further. -
Decrease in Inflation
In 1974 the inflation rate was up at 12.3% and two years later it's now down at 4.9%. This has caused the Fed to lower their rates so they have reached their lowest at about 4.75%. However, inflation is about to rise making the Fed to increase their rates once again. -
Jimmy Carters Economic Policies
President Jimmy Carter tried to fight economic stagflation, weakness, and unemployment. In 1978 he implemented price targets for industries and other policies designed to lower inflation. President Carter also increased government spending and implemented voluntary wages to decrease inflation. However, these policies did not work well as the economy was back to pre-recession levels by the end of his presidency. -
Jimmy Carter Energy Proposal
Jimmy Carter was elected in 1977, following the beginning of the energy crisis in 1973. Years after the petroleum prices rose 400%. Carter put forward a solution which included controlling the release of gas to consumers, limiting imports, and developing alternatives solutions to the problem. -
Fed Funds Rate Increase
The Fed raised their rate to combat a rise in inflation. A recession began in January which caused the inflation rate to rise to 14.6%. The Fed raised their rate up to 20% to try and combat this inflation caused by the recession. -
Jimmy Cater - Inflation and Unemployment
When Carter was put in office in 1977, he criticized former President Ford for failing to control inflation and unemployment rates in the country. However, after four years the both of these rates have gotten severely worse than they were before his inauguration. -
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Reagan Presidency
In general, Reagan pursued decreased taxes, often referred to as Reaganomics, and increase military spending. This all occurred during the heart of the Cold war. -
Economic Recession
This recession was caused by the Fed because they raised interest rates to combat inflation. This in turn, reduced business spending and made prices sky rocket. The Fed caused the worst quarterly decline since the Great Depression and unemployment rose to 10.8% during late 1982 -
Reagan Economic Policies
After the recession of the 70's, Reagan first plan was to cut taxes. His plan, first revealed in Aug 13, 1981, would be a major tax cut, lowering the taxes for the wealthiest bracket from 70% to 50% over the following years. During his presidency the economy grew very fast, as it came out of the recession of the past decade. -
The Fed Rate Decrease
The Fed has lowered their rates down to 5.66% which is the lowest it has been in a long time. The inflation and unemployment rates are also very low, sitting at 1.1% and 6.6% respectively. However, these rates are all about to rise in the coming years. -
Stock Market Crash
Known as the largest single-day market loss in U.S. history. Sellers began to dominate trading. More and more investors sold causing a massive cycle to occur throughout the day. At the end, the stock market had lost 23% of its value. Event was known as Black Monday. -
Inflation Rate Rising
Once again the inflation rate is going up. It's now up to 4.4% from 1.1% and will continue to rise. The Fed has increased their rates to 9.75% to try and fight inflation. They have been raising their rates throughout all of 1988 as the inflation rate has gone up during this time.