Conventional wisdom has it that recessions ensue after the Federal Reserve raises short-term interest rates significantly. The Fed is embarked upon just such a campaign in order to cool demand and deflate any building inflationary pressures. Short-term rates have been raised from their historic low of 1% to the current 3.75% and more increases are expected.

Many economic observers claim "this time, it is different." And given the current robustness of the US economy, it is hard to argue that point. But with eerie similarities to the late 1960's-early 1970's - e.g. a budget-busting foreign military entanglement, rising Federal deficits and an energy shortage creating soaring fuel costs - the risks to the US economy, both from inflation and possibly recession, are building quickly.