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When the Fed screws up, recessions follow

The Federal Reserve will decide in two weeks whether to raise interest rates for the second time in three months. Improving economic data like rising wages and inflation, and a soaring stock market, have prompted markets to assume they will do so.

Higher rates are a good sign at this stage of the recovery — they show that markets expect better economic conditions in the future. But this part of the business cycle also comes with risks, given the fact that as of this week we are in the midst of the third-longest economic expansion in modern history, after the booms between 1991 and 2001 and 1961 and 1969.