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Stop the Yield Curve Panic-Mongering. It's a Bullish Indicator
(Bloomberg) --
The fact is, a flattening 2s-10s curve is generally a positive indicator for the economy and for equities.
The research shows:
- An inverted U.S. yield curve is normally a precursor to a recession.
- However, during the last 30 years, it has taken at least a year, and an average of 18 months, after the initial inversion before the recession set in. The economy actually kept growing as the curve narrowed.
- And, importantly, the U.S. yield curve still has a long way to go before it inverts.
- During the last 30 years, a recession has come only after the curve starts steepening again post-inversion.
- The related S&P 500 peaks came an average of 13 months after the curve first inverted.
yesterday the market trow us another all time high on the DOW, S&P etc... i guess we will see more until the Tax relieve is approved . when that happens we could have a sell on the news event. Until that i think it's totally green light.
But even after that correction we are in a Bull market in everything except value. That will come back.
From EVA Capital Management presentation
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