Much is being made about the Inverted Yield Curve
right now where the 90 Day T Bill is yielding 2.43%,
but the 10 Year Note only obtains you a rate of 2.37 %,
for locking up your money for 10 years. Ouch.
Implications are growing that the significance of this inversion
will soon show up in a much more broader economic recession later this year in the United States.,
than expected.
Bond traders live or die on fractions of a % moves in interest rates.
And bond trader's are some of the smartest in the business.
10 yr long term interest rates bottomed at 1.33% in 2016, at the time of Brexit referendum
and then topped at 3.25 % in 2018, as worldwide growth,
suddenly, and with very little warning
began showing a marked slowdown.
Line Break Daily Chart shown here for TNX confirms a massive rollover top in yield,
Look at how ugly that chart looks if you are trying to capture yield.
Consider these possibilities...
1.Is the 50 % pullback in long term rates now sufficient to reach an equilibrium,
between top end growth, and bottom line recession ?
2. Does this dramatic, and unexpected pullback in long term interest rates,
have a much more significant meaning that we don't fully understand yet,
to the health of the US economy ?
3 How will the stock market react, six-nine months out from now
, to the unmistakable signals of a slowing economy that the bond market is foreshadowing now ?
My own belief tells me that the equity crowd, stock market traders and investors, pundits galore,
will simply choose to ignore these striking bond market divergences,
,..until it's too late.
""Don't Worry. Be Happy" :)
TNX Last 2.37 %
THE_UNWIND
3/28/19
Mountains/New York
right now where the 90 Day T Bill is yielding 2.43%,
but the 10 Year Note only obtains you a rate of 2.37 %,
for locking up your money for 10 years. Ouch.
Implications are growing that the significance of this inversion
will soon show up in a much more broader economic recession later this year in the United States.,
than expected.
Bond traders live or die on fractions of a % moves in interest rates.
And bond trader's are some of the smartest in the business.
10 yr long term interest rates bottomed at 1.33% in 2016, at the time of Brexit referendum
and then topped at 3.25 % in 2018, as worldwide growth,
suddenly, and with very little warning
began showing a marked slowdown.
Line Break Daily Chart shown here for TNX confirms a massive rollover top in yield,
Look at how ugly that chart looks if you are trying to capture yield.
Consider these possibilities...
1.Is the 50 % pullback in long term rates now sufficient to reach an equilibrium,
between top end growth, and bottom line recession ?
2. Does this dramatic, and unexpected pullback in long term interest rates,
have a much more significant meaning that we don't fully understand yet,
to the health of the US economy ?
3 How will the stock market react, six-nine months out from now
, to the unmistakable signals of a slowing economy that the bond market is foreshadowing now ?
My own belief tells me that the equity crowd, stock market traders and investors, pundits galore,
will simply choose to ignore these striking bond market divergences,
,..until it's too late.
""Don't Worry. Be Happy" :)
TNX Last 2.37 %
THE_UNWIND
3/28/19
Mountains/New York