Earlier this year, JP Morgan Asset Management’s Chief Global Strategist David Kelley likened the current U.S. economic expansion to a healthy tortoise, “slow but steady.”
The United States has experienced slow and steady economic growth through corporate profits, job growth and wage increases. This month marks the 10th year of our current expansion; it ties the record for the nation’s longest expansion on record (120 months), which happened from March 1991 to March 2001.
There are a few complications on the horizon that could threaten the health of this tortoise, however. Jon Hilsenrath, Wall Street Journal chief economics correspondent, points to “tariff-driven trade wars with China, Mexico and others that damage business, household and investor confidence” as an area of concern. He also notes that a mistake by the Federal Reserve with interest rates could hinder the economy’s growth. The “country’s ballooning budget deficit” also compromises the government’s ability to enact meaningful fiscal policy (such as reduced spending or tax cuts) to aid the economy, according to Hilsenrath.
With all that said, there are plenty of examples around the world where economic expansions have lasted much longer than 10 years (see Economic Cycle Research Institute data in the chart at right).