As a growing number of big-money folks around Wall Street are worried about a looming recession, Goldman Sachs' economists aren't very concerned at all.
While it may be a case of famous last words, the bank's experts in fact say the U.S. economy is less prone to recession than it has been in the past, thanks to a confluence of factors that have emerged during the "Great Moderation." The term refers to the controlled growth with less volatility that has prevailed through much of the period since the mid-1980s, with some notable exceptions.
Though the country has weathered several recessions including a financial crisis during that span, Goldman considers the economy of 2019 built to absorb the kind of shocks that would trigger negative growth.
"The changes underlying the Great Moderation appear largely intact, and some have even strengthened," Jan Hatzius, the firm's chief economist, said in a research note. "A look back at 100 years of US recessions suggests that several of the most important historical causes are less threatening today. While some new risks have emerged, on net we see the US economy as structurally less recession-prone than in the past."