No Better Signal Than the Yield Curve

By Kevin Muir 

Remember back a few years ago when all the hard-money advocates were complaining about how the Federal Reserve was distorting the economy with their zero interest rate policy? Hedge fund managers like Greenlight Capital’s David Einhorn constantly harped about the artificial “sugar high” the aggressive monetary policy stimulus was inflicting on both markets and the economy. These disciples kept pushing for higher rates. Immediately. Like yesterday.

Well, they got their wish. After six years of leaving rates basically at zero, in 2016 the Federal Reserve embarked on a tightening campaign and rates have been marching higher ever since.

I can already hear the complaints from the hard-money crowd about why this isn’t good enough – the Federal Reserve is raising rates, but it’s been at a glacial pace. And no doubt they are correct. This has been one of the slowest tightening cycles on record. And let’s face it – two hundred basis points of tightening in two and a half years is not that much.

Continue reading No Better Signal Than the Yield Curve

Treasury Yield Curve (10Y-2Y) Flattens To Lowest BEFORE The Great Recession

By Anthony B. Sanders

As Commercial Real Estate Prices Fall to Lowest in Nearly Two Years (Fed Inferno!)

It’s NOT a wonderful day in the economic neighborhood.

The US Treasury yield curve (10Y-2Y) has just flattened to 45.6 basis points, the lowest since just before The Great Recession.

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And Green Street Advisers is reporting that commercial real estate prices have fallen to the lowest level in nearly two years, thanks primarily to the retail inferno.

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Burn, baby, burn! Fed inferno!

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Bad Omen for Markets From First Signs of Yield Curve Inversion…

By Anthony B. Sanders

Q1 Auto Registrations YoY Down To -12.2%, Lowest Non-Recession Reading Since 1989

There are troubling signs in the US economy, not the least of which is the lowest YoY growth in US automobile registrations (non-recession) since 1989.

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Another troubling sign is the possible yield curve inversion.

Continue reading Bad Omen for Markets From First Signs of Yield Curve Inversion…