Lots of people have been huffing and puffing about whether or not the US economy will go into a recession in the near future, with Menzie Chinn and Jim Hamilton at Econbrowser saying it is now about 50-50 whether or not the US economy will go into recession by the end of 2020. I do not have a horse in that race, but I am struck that a new odd phenomenon has recently appeared in the US economy, a split between sectors regarding their performance that recently seems to be increasing.
The sectors are manufacturing, which has been declining now for several months and is the harbinger of recession. Meanwhile single family permits are up, and YOY permits overall are up by 8 percent that may well hold off any recession if it continues to accelerate. It is unclear which will win out.
So the general story of manufacturing looking to decline while housing construction is likely to rise still holds for the fairly near future.
The manufacturing decline has been widely tied to the trade wars, which would appear to be at least partly responsible. It is also the sector that through trade may be experiencing the pressures of the slowing of global growth.