Since 1950, periods of expansion in developed markets have lasted an average of eight years—though the average in the U.S. over the same time has been around five years. And
Goldman has created a scatter plot of 255 expansions across 14 developed economies, depicted below. This implies that the current expansion, at six and 1/3 years old, will likely endure, Goldman says. The current expansion started in July 2009, according to the National Bureau of Economic Research, so we only have a couple more years to go. And the likely hood of a recession is minimal.
Link: http://www.msn.com/en-us/money/markets/us-economic-recovery-has-4-more-years-to-go-experts-say/ar-CCflwF
5 comments:
Well if this isn't incentive for the FED to raise interest rates, I'm not sure what is. They have been saying the delay has been because they don't want to throw the economy into shock that would cause negative effects, but the article proves that we are on a solid foundation again. Plus, with the continued low rates, people will continue to not save money, which isn't always the best policy.
I dont think the Fed should rush to make a decision and raise the interest rates. the holiday season is coming, people will spend more while interest rate is low. The Fed should wait till the spring to decide.
I agree with Ying. Personally, I do not think that the Federal Reserve should rush to make a decision already about raising interest rates this coming December. While I do not feel that they should rush to a decision so quickly, I do however feel that they should consider raising them for the overall health of the American economy in the beginning months of 2016 so that they can combat a recession if needed - it is only smart.
For now, I think that they should wait to see what the holiday season brings. Even though consumer confidence (as of October 27th, 2015) stands at 97.5 (1985 = 100), down 5 points since September, I believe that this is just the norm with the holiday season around the corner. The holiday's always constitute spending, and I do not think that this holiday season will be any different. As stated in the article, the economy is expected to expand, and so, with expansion comes unforeseeable opportunity.
It was neat seeing that everyone had the same concern - interest rate implications. This was my thought as well. My concern is that rates are still virtually at zero and have been for years now. If the Fed does not raise them significantly in the next few years, the zero lower bound issue could be a major issue when the next business cycle hits.
Given what was said during the Economic Outlook Conference, rate hikes will be happening in the near future and continuing into 2016, with a hike each quarter. That being said, it seems like the issue should be resolved with the FED's upcoming plan.
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