Bill Holter’s Commentary
You already knew this but you might want to read the comment section for a few laughs?
The Recession Question We Should Be Asking Isn’t ‘When’ But ‘How Bad?’
August 15, 2019
It’s taken a while, but equity investors finally seem to get what bond investors have been signalling for months. Back in March, the yield curve for three-month and 10-year U.S. Treasuries inverted, meaning the three-month bills were yielding more than the 10-year notes, which isn’t the right way around if everything is hunky-dory in economics-land. But stock markets went on to have a pretty good April, a so-so May and then an even better June, as investors paid more attention to the Federal Reserve’s flip-flop than to the yellow light the three-month/10-year curve was flashing.
But on Wednesday, a more traditionally watched yield curve — the one between the two-year and 10-year Treasuries — also inverted. And so did the corresponding curve in the U.K. Add to that some dismal data from Germany and China and — well, oh yeah, the yield curve inversion mattered again.