The business cycle hasn’t been repealed, but the current one is playing out like none in living memory. “I’m a believer in business cycles and monetary cycles. This will be the most telegraphed, anticipated and expected recession in history,” said Permanent Portfolio president and portfolio manager Michael Cuggino. “The surprise factor will be lower.”

Of course, there will be another recession. But what if the current expansion has a long way to run. A yield-curve inversion prompted lots of hand-wringing in late March, but a three-day inversion doesn’t qualify as a recession signal. Moreover, virtually all the historical evidence on yield curve inversions is based on very different interest rate environments that markets have experienced in the last decade.

“There is nothing in the current economic data that indicates a recession is pending or imminent,” Cuggino said. “If you get a yield curve that is flat but not inverted, it’s not necessarily recessionary.”

In fact, if a recession were likely, one would expect to see yields on questionable junk bonds rising. That's not happening.

Some experts believe that the yield curve in the U.S. could be distorted by the level of global interest rates and, as Cuggino noted, the relative strength of U.S. assets. In recent days, 10-year German bunds have sold at negative rates and this has to have increased demand for 10-year Treasurys, which closed Tuesday yielding 2.42 percent.

In recent days, German yields have fallen below those in Japan for the first time in thee years. Whether an investor is looking for yield or capital appreciation, U.S. Treasurys are among the most attractive sovereign bonds in the world.

Global growth is anemic, Cuggino observed. European nations, particularly Germany and Italy, may well be in their own recessions. With France plagued by yellow jackets and England flummoxed by Brexit, it’s an open question how long those two countries can keep growing.

America is performing a lot better. But even that’s relative. Everyone expects the first quarter to be weak after the fourth-quarter stock market correction and government shutdown in January. But soft first quarters have become commonplace in the last decade. Some people are expecting a slowdown from 2.9 percent to 3.0 percent GDP growth to continue this year, but consumer spending could pick up sharply in the second quarter.

Some, like Allianz Life’s chief economic advisor Mohammed El-Erian, believe the U.S. can grow at 2.5 percent this year. Some of the stimulative effects of Trump's tax cuts are fading, but he noted that increased government spending can pick up the slack.

Other crosscurrents are likely to influence the second quarter. Cuggino noted that upper-middle-class folks with lots of disposable income in high-tax states are likely to face higher tax bills. How this impacts overall consumer spending remains to be seen.

But there also is a virtuous cycle arising from falling interest rates and other factors. Housing in many segments of the market is becoming more affordable and millennials who have resisted buying first homes are starting to be lured into the market. The market for mid-priced, first-time homebuyers is already heating up and the most recent report found mortgage applications were up 9 percent.

Conventional wisdom holds that consumers are in great shape. But James Macey, director of multi-asset portfolio management at Foresters Financial, noted this view is based on backward-looking metrics like the unemployment rate. Household debt currently stands at about 75 percent of GDP. That’s better than 110 percent in 2008 but, for the sake of comparison, way above 40 percent in the early 1980s. Global PMI numbers are at 32-month lows and small business optimism has fallen five months in a row.

A number of other issues are swirling around the market, Cuggino explained. If growth picks up in the second quarter, what will the Fed do? The market thought the central bank might eventually be forced to raise rates, but Fed officials surprised the bond market when they took that option off the table last week. The reversal led many to conclude the Fed’s predictive powers are not particularly impressive.

Workers are receiving healthy wage gains for the first time in this cycle and it could translate into higher inflation. Even if the Fed doesn’t see it, analysts who study the financial reports of S&P 500 companies say it is evident in their results.

“Corporate earnings are [still] growing and interest rates are reasonable,” Cuggino maintained. “Where we are makes perfect sense.”

Corporate profits are up a modest 3 percent to 6 percent this year, but companies are keeping a lot more of their profits now that they are being taxed at a 21 percent rate. With more cash flowing to their retained earnings, weak companies are in a position to rebuild their balance sheets.

Macey said that the S&P 500 is essentially flat for the past year and complacency among retail investors after a decade of double-digit gains in the S&P 500 leaves consumer psychology vulnerable in the event of another correction. Indeed, the collapse of retail sales in December, no matter how brief, shows how powerful the wealth effect has become.

Like Macey, Cuggino sees some warnings signs for individual investors. “Pay attention to the IPO market,” Cuggino said.

Institutional investors in tech companies like Uber and Lyft are looking to cash out and flip their equity to the public before the next recession hits. That’s something “you saw a lot of in the 1990s,” he continued.

Few people, including Cuggino, are suggesting that the next recession will be triggered by a 1990s-style tech bubble. High-yield corporate debt with weak covenants is seen as a far more likely culprit in the current cycle.

What about trade talks with China? Cuggino thinks that if all America gets is an agreement with China to buy a few more cars, soybeans and pork, the whole thing "will have been a colossal waste of time." But if a trade deal addresses intellectual property rights, forced technology transfers, the rule of law and market access, it could be a major win for the global economy.

So if the next recession does arrive in 2020 or 2021, how will it play out? The biggest fear of most professional investors is that the companies whose executives were the most overextended with leverage run into debt service problems. Even if the covenants favor them at the expense of bondholders, their stock prices collapse and they get acquired by financially competitors. Those competitors promptly fire thousands of workers to make the acquistions accretive to earnings.

Just look at Disney’s acquisition of Fox’s movie and TV studios, which closed last week. The ink was barely dry when pink slips started going out to top Fox execs. The number of layoffs is expected to go into the thousands as Disney seeks to save $2 billion in annual expenses to justify its $71 billion price tag.

It's also worth noting that Fox was a very successful, profitable company. Less viable businesses are likely to experience more severe cost reduction plans.

How fast or slowly this scenario unfolds could determine when the next recession arrives.