Afternoon in America: Will the Fed greet the next president with a recession?

Posted: October 14, 2016 in economy
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IT WAS just a few months into the presidency of Barack Obama that America crept out of the Great Recession and into the current expansion. With just three months to go in his second term, Mr Obama seems likely to pass that expansion on to his successor. But what are they odds that she will make it through a four-year term without a brush with economic contraction? The Wall Street Journal polled 59 economists to get their view. They reckon there is a 60% chance of recession striking within the next four years. Is that a reasonable estimate? Let's consider a few facts about expansions and recessions.1) This expansion is getting up there in years, by American standards… The recovery began in June of 2009, which means that we are currently in its 88 month. According to NBER, which maintains a list of historical recessions going back to the mid-19th century, the current expansion is the fourth longest on record. The third longest, at 92 months, was the great boom of the 1980s, which the Obama boom can surpass in March of next year. Then comes the 106-month expansion of the 1960s, and finally the Clinton boom of the 1990s, which lasted a full ten years. If it continues, the current expansion would become the longest in America's history in July of 2019, just over two years into the next presidential term.2) But not necessarily by global standards. That's not …

via Economic Crisis


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