JanetYellen on Nostr: You get a higher yield on 2 year bonds than you do for 30 year bonds right now (which ...

You get a higher yield on 2 year bonds than you do for 30 year bonds right now (which is opposite of what it should be). It is often a strong predictor of an incoming recession. The yield on the short end of the curve increases because of the Fed raising the Fed funds rate, but the longer duration bond yields decrease because of the market projecting lower future growth and future rate cuts.



Look at this figure and see how prior yield curve inversions in 2000 and 2008 preceded recessions (shaded areas) and large stock market declines. Our yield curve inversion is at record highs right now and getting worse everyday.