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The news is filled with stories of when to expect the next recession. Most say that it will not be this year, but almost certainly sometime in the next two or three years. The underlying assumption is that the current expansion, which will surpass our nation’s longest expansion of the 1990s this summer, has to end soon.

But there is not a “natural” economic reason for this expansion to end. A look back shows recessions occurring from time to time. In recent decades they have been less frequent and have been much milder and shorter than historically, other than the 2008 Great Recession. The onset of a recession can generally be traced to some combination of fiscal and monetary mistakes. The one recent exception was the 2000-’01 recession resulting from the large overvaluations built up during the 1990s.

Forecasting the next recession is not a mechanical “business cycle” process but involves trying to figure out when the next major policy mistake will be made. Without such a mistake, the expansion could continue uninterrupted into the foreseeable future.

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