by An Increasingly Divergent US Economy Lots of people have been huffing and puffing about whether or not the US economy will go into a recession in the near future, with Menzie Chinn and Jim Hamilton at Econbrowser saying it is now about 50-50 whether or not the US economy will go into recession by the end of 2020. I do not have a horse in that race, but I am struck that a new odd phenomenon has recently appeared in the US economy, a split between sectors regarding their performance that recently seems to be increasing. The sectors are manufacturing, which has been declining now for several months, the harbinger of recession, and housing starts, which has more recently been showing an acceleration of growth that may well hold off any recession if it
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Barkley Rosser considers the following as important: US/Global Economics
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An Increasingly Divergent US Economy
Lots of people have been huffing and puffing about whether or not the US economy will go into a recession in the near future, with Menzie Chinn and Jim Hamilton at Econbrowser saying it is now about 50-50 whether or not the US economy will go into recession by the end of 2020. I do not have a horse in that race, but I am struck that a new odd phenomenon has recently appeared in the US economy, a split between sectors regarding their performance that recently seems to be increasing.
The sectors are manufacturing, which has been declining now for several months, the harbinger of recession, and housing starts, which has more recently been showing an acceleration of growth that may well hold off any recession if it continues to accelerate. It is unclear which will win out.
The manufacturing decline has been widely tied to the trade wars, which would appear to be at least partly responsible. It is also the sector that through trade may be experiencing the pressures of the slowing of global growth.
Barkley Rosser