National Real Estate Investor
By Matt O'Brien, November 20
Maybe the best reason to think there won't be a recession in 2020 is that so many people are saying there will be.
The idea being that the more people are worried about something, the more they should do to try to avoid it — right? You'd certainly think so, but not always. Consider the housing bubble: Economists including Paul Krugman and the Center for Economic and Policy Research's Dean Baker spent years warning about the impending danger, but it didn't matter. Policymakers didn't do anything, and everyone else was too busy trying to get in while the getting was good to concern themselves with whether it was sustainable.
Which brings us to our two big risks today. The first is that interest rates, though still low by pre-crisis standards, are starting to get a little high by our post-crisis ones. In fact, the best recession predictor we have — the difference between the government's 10-year and two-year borrowing costs — is beginning to flash yellow. Read more.