By Patrick Watson via Iris.xyz

By most measures, the US economy is performing okay. GDP growth is still near 3.5%. Unemployment is below 4%. Inflation is up a bit but still historically low.

Yes, the data has flaws. There’s plenty of regional variation. Your mileage may vary. But conditions could be a lot worse.

The problem: Sometimes the economy weakens beneath the surface.

This fools even experts like Larry Kudlow, one of President Trump’s top economic advisors. In December 2007, he wrote, “Economic growth may indeed pause to roughly 2 percent in the next couple of quarters, the result of two years of overly tight money from the Federal Reserve and the ensuing upturn in sub-prime defaults and foreclosures. You can call it Goldilocks 2.0. But you can’t call it a recession.”

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