From March of 1965 through July of 1970, the unemployment rate spent every single month below 5%.1
That’s the longest streak on record in modern economic history…until now.
Since the fall of 2015, the unemployment rate has been below 5% for 125 consecutive months:
OK fine this chart is not technically true.
The unemployment rate spiked to 14% during the first few months of Covid. But that was not a real recession. There was no credit cycle. It was man-made. People on unemployment insurance were being paid to not work. Businesses were being paid by the government to stay open.
The labor market essentially recovered immediately.
Sure, some would argue maybe the economic cycle would have run its course if the pandemic hadn’t caused governments to spend trillions of dollars. That’s a fair rebuttal.
But I think it’s a legitimate argument to call this the longest economic expansion in history.
There hasn’t been a real recession since 2009.
There’s been no credit cycle in that time either.
No financial crises to speak of.
The stock market has experienced just two down years out of the past 17. The S&P 500 is up nearly 14% per year since the beginning of 2009.
The economy has continued to grow despite 9% inflation, the Fed raising rates from 0% to 5% in a hurry, tariffs, wars, energy shocks and more.
At the very least, this is the most impressive economic expansion given everything that’s been through at it.
This economic boom hasn’t always been perfect. There are certainly parts of the economy that have struggled. Not all households have benefited equally.
At some point the cycle will turn. I don’t know when or why. No one does.
Everyone who has been predicting the downfall of the economy since the end of the Great Financial Crisis has been wrong, often spectacularly so.
The economy just keeps chugging along.
Further Reading:
Some Things That Didn’t Happen
1Then from the start of 1974 through the spring of 1997, the unemployment rate remained above 5% for 279 consecutive months.
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