SPresent21

The Next Recession

I've presented a cross comparison between the S&P 500 , the 10-2 Treasury Yield Spread, and the FED Funds Rate. The yield curve has been effective at predicting recessions in the past. I think the next will be no different.

There is a lot of fear at the present moment that we may be on the verge of a market crash. We have seen a large correction that is likely not over. However, once trade tensions ease the market will forget this fear and continue on. Greed is high at market tops which is why we have not yet seen the top of this market. Now with this large correction under our belt common belief will likely be that we will have plenty of room to run now that everyone has loaded their cheap shares. This will start the next bull run that should lead us right into the next market crash and recession. Based and the analysis in the chart 2020 seams to be a likely year for the start of the next recession. I have heard opinions from multiple economists that have made similar predictions. Considering the credit bubble we have now is even larger than the one of 2007, the next recession will probably be quite severe.

I'd love to hear others thoughts and opinions.
The Fed funds rate in this graph could be adjusted downward in 2009 through zero for the QE - and upward in 2015 for QT. e.g 100bln QE = -1% in fed funds rate... so fed funds rate is already nearer the green line - and so the down turn of S&P is closer.
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I agree. I also see when 10Y and 2Y meet, gold goes up. I've made 30% on JNUG since Nov. If 10Y 2Y fall below the Fed Fund rate a credit crunch occurs and that to me is the trigger and takes a few to many months to metastasize. If you happen to be in gold for a run-up, be ready to be out because in a deflation just about all assets go down.
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SPresent21 mcfarrell
@mcfarrell, Very true, many don't realize that but it is obvious when looking at a chart of gold during 2007-2008. I plan on riding deflation out in inverse ETFs.
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@SPresent21, Hi there, found same outcome using little bit different approach
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I Concur.
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