Consider the situation in the U.S. during the 1990s: the Internet
phenomenon created a host of wonderful investment opportunities in the
U.S. that promised to be very profitable. how did this affect our
country's loanable funds market, our net capital outflow, and our
foreign currency market.

Homework or the like?  Two (maybe more) questions on economics ...

The internet bubble in the 1990's was sheer idiocy.

Stocks were wildly overpriced
- market 'professionals' were hyping junk

I'm not sure how much non USA investors participated in the fiasco
- my impression is that it was a domestic phenomenon

Actually, Frde, the 'net bubble of the 1990's mirrors in many ways the
stock bubble and eventual crash of the 1920's. If you substitute
"automobiles" for "computers" and the like, you will see the
similarities. The problem with calling these bubbles idiocy is that it
lets off the real criminals.

Henry Blodgett (may he suffer the pain of a million blowflies hatching
in his skin every second) and other hucksters have their equivalents
in the 20's.
These crooks lied to millions of people who wanted nothing more than
to dabble in the stock market. Blodgett and his ilk should be invited
guests on Dick Cheney's next quail hunt.

@Markvmd

I quite agree.

There are earlier bubbles too, the South Sea period, also the tulip mania.
Property in the UK in the later 1980's
People just don't learn.

What baffled me in the 1990's was that it was perfectly clear that it
is very hard to make money from the internet.
'New Paradigm' - Pah !