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The US economic expansion is approaching its eighth anniversary, prompting some investors to worry the recovery might be a bit long in the tooth.
So what will trigger the next recession?
It's become a new Wall Street adage that economic recoveries don’t usually die of old age. Rather, they are often the result of an active central bank policy to slow an overheating economy.
However, a new report from the Bank of International Settlements, an association of 60 member central banks around the world, suggests that’s not the way it’s going down next time around (and they don’t try to predict when that time will be):
"The main cause of the next recession will perhaps resemble more closely that of the latest one – a financial cycle bust,' the BIS report says.
"While an inflation spurt cannot be excluded, it may not be the main factor threatening the expansion, at least in the near term," the BIS adds. "Judging from what is priced in financial assets, also financial market participants appear to hold this view."
The US economic expansion is approaching its eighth anniversary, prompting some investors to worry the recovery might be a bit long in the tooth.
So what will trigger the next recession?
It's become a new Wall Street adage that economic recoveries don’t usually die of old age. Rather, they are often the result of an active central bank policy to slow an overheating economy.
However, a new report from the Bank of International Settlements, an association of 60 member central banks around the world, suggests that’s not the way it’s going down next time around (and they don’t try to predict when that time will be):
"The main cause of the next recession will perhaps resemble more closely that of the latest one – a financial cycle bust,' the BIS report says.
"While an inflation spurt cannot be excluded, it may not be the main factor threatening the expansion, at least in the near term," the BIS adds. "Judging from what is priced in financial assets, also financial market participants appear to hold this view."