Main yield curve inverts as 2-year yield tops 10-year rate, triggering recession warning

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Debating if I should also start a new post on the breaking news of inverted yield curve and how that has accurately predicted the recession within 18 to 24 months. 20 upvotes: yay 20 down votes: nay

programmingguy

I’ve said this here a ton, but it bears repeating here again. The 2-10 yield curve being the “main” one is simply a product of small sample size and statistical overfitting. Ie, it has a hit rate of 1-2 more successes than other curves over a period of 7 recessions. The federal reserve use the 10-3m yield curve, and what really matters the most, is where the curve as a whole is sitting and ***why*** it’s a negative curve. The entire damn curve has been below the fed funds rate for a while. Honestly, nothing that significant has changed, but we of course are now going to get a ton of headlines about this because it’s a talking point and the media LOVES the 2-10 yield curve.

cbus20122

It is no longer inverted, but I assume that doesn’t matter in terms of a recession indicator, correct?

Ry-Fi

Can someone explain what control this except of investors putting more money in 2 or 10 loans? Can feds control this? By increasing spending and yeilds for 10 loans? I. E. Can they artificially fight this signal?

yuk83

Hopes for profit of investors on scale of 10 years just dropped and that means that current prices of stocks which are hope of profit for other investors are going down as well. Pure logic.

mighty__