The 1990s was one of the most productive, prosperous decades in American history. The US economy, buoyed by technological advancement, hummed with efficiency. It did not run too hot to create inflation, nor too cold to hinder growth. It was called the Goldilocks economy because it was "just right."
Suddenly the economy ground to a halt. By the end, in October 2002, the US equity markets suffered the longest bear market in 70 years. The market declined for 32 months, three times longer than the average bear market since World War II. This bear market was exceeded only by the Great Depression's 34-month decline.
For the period, the Dow was down 37.8%, the S&P were down 49.1%, and the NASDAQ declined an astonishing 77.9%.
Eight and one-half Trillion dollars in equity value disappeared. Retirement dreams were dashed. College dreams were put on hold. College and hospital endowments were smashed. The Shriners had to close several hospitals for crippled children. Governments and schools suffered as tax revenues declined. Over two million people were thrown out of work. There is no telling how many productive companies that would have led to an improved standard of living in the US were shuttered.
Alan Greenspan reported that the economy was going through a "soft spot," and became Sir Allan "for his contribution to global economic stability."