Over the past few days there’s been lots of chatter about the recent flattening of the yield curve. The rising of short term yields with the opposite move at the longer-end has caused the 2 and 5-year portion of the curve to invert. With any inversion, suddenly everyone is a bond trader and has an opinion about what it means for risk assets and the world in general. Of course, the MacroTourist is no exception, but before I throw my opinion into the sea of sound bites, let’s examine how we got here.
DON'T IGNORE THE YIELD CURVE
DON'T IGNORE THE YIELD CURVE
DON'T IGNORE THE YIELD CURVE
Over the past few days there’s been lots of chatter about the recent flattening of the yield curve. The rising of short term yields with the opposite move at the longer-end has caused the 2 and 5-year portion of the curve to invert. With any inversion, suddenly everyone is a bond trader and has an opinion about what it means for risk assets and the world in general. Of course, the MacroTourist is no exception, but before I throw my opinion into the sea of sound bites, let’s examine how we got here.