U.S. Defies Odds and Continues Longest Postwar Economic Expansion   

The U.S. economy is like a charismatic movie lead who continues to succeed against all odds. Despite the burden of tariffs due to international trade tensions, shaky investments, and a murky financial future, unemployment is low and consumer spending steady. But reality does not always have a neat ending, and business leaders are still treading lightly as signs point to an economic downturn.

It’s impressive how well the U.S. economy has held up during the past year. As early as 2018, leading indicators were suggesting a heightened risk of recession in 2019 or 2020. Then early this year the yield curve inverted, a traditional signal that recession is imminent (the inversion has since reversed, but this typically happens before growth actually goes negative). The trigger for a downturn wouldn’t be hard to identify -- a slowing China, combined with President Donald Trump’s trade war. Already, countries such as Singapore and South Korea, which export lots of manufactured goods to China, are slowing down.

But despite all the pieces that seem to be in place for a recession, it hasn’t happened. This expansion is now the longest in postwar history, having recently surpassed the long boom of the 1990s. Unemployment remains low and the prime-age employment-population ratio -- a better indicator of labor-market strength -- continues to increase:

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