Expansion of economic activity in the U.S. began nearly eight years ago in July 2009. Expansions do not die simply of old age. They turn into recessions when the economy overheats. Markets usually tend to be myopic and underestimate the presence of recession-inducing excesses and, thus, are surprised when recession occurs. Today, there does not appear to be any single highly visible imbalance to interrupt the steady upward march of economic activity. However, when the economy is operating at full employment and the Federal Reserve is engaged in tightening monetary policy, risks inevitably build. In this month’s letter, Bill Longbrake examines risks – “yellow flags” – which, in addition to tightening monetary policy, are present in the U.S. economy and deserve attention and monitoring. Read the full letter.