While the U.S. economic expansion is old, it isn’t creaky, and time hasn’t run out on the expansion just yet.
The U.S. economy is now in its tenth year of expansion and, at 36 quarters, is within two quarters of being the second-longest on record. “Late cycle” is a term heard frequently these days to suggest the end of this amazing streak is near. Late cycle carries a negative connotation, suggesting a recession is approaching, bringing with it potentially dire consequences for investors.
In our view, a sole focus on the time elapsed for this expansion is misplaced. Economic cycles don’t simply die of old age. And, based upon the key indicators we monitor, the current cycle likely has room to run—at least several quarters, perhaps even years.
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