Who would’a thunk a massive tax cut, open ended war, and slamming the economy with mass deportation, tariffs and uncertainty would result in this outcome?
2 thoughts on “Bond Yields: Two Pictures”
New Deal democrat
I haven’t been able to find the post, but some months ago I asked when the recession signal from the 2022-24 yield curve inversion could be considered a false positive.
At this point we are 50 months past the 10-2 year inversion, and 38 months past the 10y-3m inversion. We are also 25 and 11 months pst their re-normalization. So by my counting, we are well past the point where those signals were valid.
New Dear democrat: Yes, I think most would agree that’s a false positive; I’m working on explaining why we got that signal, and no recession occurred. Remember, it could be probabilities (we use a 50% threshold?), wrong model/omitted variables (other variables should have been included), etc.
I haven’t been able to find the post, but some months ago I asked when the recession signal from the 2022-24 yield curve inversion could be considered a false positive.
At this point we are 50 months past the 10-2 year inversion, and 38 months past the 10y-3m inversion. We are also 25 and 11 months pst their re-normalization. So by my counting, we are well past the point where those signals were valid.
New Dear democrat: Yes, I think most would agree that’s a false positive; I’m working on explaining why we got that signal, and no recession occurred. Remember, it could be probabilities (we use a 50% threshold?), wrong model/omitted variables (other variables should have been included), etc.