The Bureau of Economic Analysis has revised up its accounting of the domestic economy's performance. In its latest estimate, the BEA reports the economy expanded at an annual rate of 3.9 percent in the second quarter. While that represents a marked improvement from the prior period, investors are scouting for clouds on the horizon. More than six years into the current economic expansion, market participants are asking the obvious question. How long can it go? On average, expansions in the post-World War II era have lasted a little under five years (58.4 months, to be precise). If the current cycle resembled the average, the United States would be in the early throes of the next recession. Keeping us company, we would be joined by other globally significant economies, including Brazil, Canada, and Japan.

As it turns out, there is some truth to the rumor. Expansions in the United States with lower average annual growth rates tend to be longer in duration. That is not a statement about causality; we could just as easily say that longer expansions tend to be weaker. As for the dynamics at work, slower growth might drag on the speculative behavior that feeds the progression of the business cycle, prolonging the expansion in the process. Be that as it may, growth that falls short of the economy's potential is hardly cause for excitment. If nothing else, weaker recoveries also exhibit a dissappointing pace of job gains, the essential ingredient for commercial real estate space demand.