{"id":19741,"date":"2019-06-30T17:25:40","date_gmt":"2019-07-01T01:25:40","guid":{"rendered":"https:\/\/associatednews.info\/content\/what-just-happened-also-occurred-before-the-last-7-u-s-recessions-reason-to-worry\/"},"modified":"2019-06-30T17:25:40","modified_gmt":"2019-07-01T01:25:40","slug":"what-just-happened-also-occurred-before-the-last-7-u-s-recessions-reason-to-worry","status":"publish","type":"post","link":"https:\/\/associatednews.info\/content\/what-just-happened-also-occurred-before-the-last-7-u-s-recessions-reason-to-worry\/","title":{"rendered":"What Just Happened Also Occurred Before The Last 7 U.S. Recessions. Reason To Worry?"},"content":{"rendered":"

By Bobby Allyn<\/a><\/span> <\/p>\n

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\n The floor of the New York Stock Exchange. An economic indicator known as the “yield curve inversion” hit the three-month mark, which has preceded the past 7 U.S. recessions.<\/p>\n

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Richard Drew\/AP<\/p>\n

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Richard Drew\/AP<\/p>\n

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Signs are pointing to a coming U.S. recession, according to an economic indicator that has preceded every recession over the past five decades.<\/p>\n

It is known among economists and Wall Street traders as a “yield curve inversion,” and it refers to when long-term interest rates are paying out less than short-term rates.<\/p>\n

That curve has been flattening out and sloping down for more than a year,<\/a> raising worries among some analysts that investors’ long-term view of the market is not positive and that an economic downturn is looming. <\/p>\n

But on Sunday, an inauspicious milestone was achieved: The yield curve remained inverted for three months, or an entire quarter, which has for half a century been a clear signal that the economy is heading for recession in the next nine to 18 months, according to Campbell Harvey, a Duke University finance professor who spoke to NPR on Sunday. His research in the mid-1980s first linked yield curve inversions to recessions.<\/p>\n

“That has been associated with predicting a recession for the last seven recessions,” Harvey said. “From the 1960s, this indicator has been reliable in terms of foretelling a recession, and also importantly, it has not given any false signals yet.”<\/p>\n

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\n In a 1986 dissertation, economist Campbell Harvey identified an economic indicator that would precede the next seven recessions. That indicator, known as “a yield curve inversion,” now forecasts a coming U.S. recession.<\/p>\n

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Courtesy of Campbell Harvey<\/p>\n

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Courtesy of Campbell Harvey<\/p>\n

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Still, many economic forecasters do not see a recession on the horizon. <\/p>\n