US Industrial Decline in Progress - Recession Possible

There has been a long term deterioration in US Industrial production, as shown in the INDPRO index.

While monthly decreases happen all the time, a long-term decline in yearly production averages has been in place since September 2015.

When the yearly averages are placed on a graph and compared with US recessions since 1960, there is a clear correlation between long term industrial decline and recessions.

A decline in the yearly average can occur before a recession, or during a recession, as the graph below shows.

Note that I define a recession different to the NBER, but there is an overlap.

Here is how it appears on my spreadsheet:

Long-term over-investment

In theory, investment should multiply growth. But it's not. Not since the early 1980s.

The US Sharemarket has outperformed Gross Domestic Product for way too long. The result has been slower growth.