Thursday, March 10, 2016

COTW: Prelude to Recession

The US economy is now mostly a service and consumption economy as opposed to a manufacturing economy as it was in the last century.  Manufacturing accounts for only about 12% of the economy.  In the last two recessions manufacturing contracted first, then the service sector.  In this chart presented by the Dallas Fed manufacturing has already contracted for four months in a row.  Will the purple line (service sector) follow?