Download economy 1979 - 1982

ECONOMY
1979 - 1982
BY: BROOKE, STERLING, &
AMBER
How did the weak economy
affect peoples everyday life?
-
January 1980, the U.S economy went
into a great recession at the time. The oil
prices increased.
 - 1982, there was a huge bankrupt. Not
only did if affect the business it affected
the people who worked there. Everyone
had to find the new jobs.
 - January of 1981, the unemployment rate
was 8.9%
…Continued
-
The first 6 months of 1980, and 1981-1982
was partially caused by the Iranian oil
embargo.
 - The economy entered 1982 in a severe
recession and labor market condition
throughout the year. The unemployment
rate reached 10.8% at the end of the
year.
What were the GDP, unemployment, &
inflation for each month during the
worst year of the weak economy?
Interview someone who was alive during
the time period you selected and find
out how the weak economy affected
their life?
-
“Gas prices raised a lot and it caused
people problems because majority or the
people couldn’t afford it”.
- Mom
What caused the weak economy
in the year(s) you selected?

- There are many reasons and different examples
why the economy went down in 1979-1982. In
1972 the main focus of the Government was on
bank reserves and monetary aggregates rather
than on credit conditions. In March 1980 the
federal reinforced restraint by introducing
selective credit controls. The borrowing and
spending led to many different problems in the
United States. It led to a huge decline of the
economy. Not only did the economy decline it
also had a huge problem with instability all
because the government wanted to control it. As
the government tried to revive the economy in
1980 the tightening by the government led to July
1981 and the worst post-war recession driven by
high interest rates.
…Continued
-
In 1982 the government ended it’s
Monetarist experiment when it stopped
the high interest rates and slowed money
supply growth which then triggered
unemployment, loan defaults and
bankruptcies.
What broke the cycle and helped
make our economy stronger?

- After 1982, the government developed a
new monetary policy. The Federal
government no longer tried to keep short
term interest rates artificially low, but
established fixed ranges. These ranges are
based upon inflation, commodity prices and
the exchange rate. This new way of
controlling the economy led to a lower
growth path without going into recession.
When they acted early, by adjusting short
term rates, they were able to control inflation
early before it got to disaster levels.
What people and places were
affected most by the weak
economy?
-
From 1979-1982, people 16-24 had the
lowest rate of unemployment.
…Continued
-
From 1979 – 1982, Men had a higher
unemployment rate than women.