Well, what about that recession talk? Let's take a look at something. Let's compare what the bond market did in 2016 and compare it with what it is doing now.
Here's 2016:
By the way, I chose 2016 because I noticed before that there was a big move in the 30 year during that time. This snapshot doesn't encompass it all, but there is a big part of it in just the july 2016 timeframe.
Note how the 30 year yield fell from 2.55 to 2.11. That is .44 percent in just a month.
and here's this past month.
This move is comparable to the move three years ago. The moves are comparable, but there was no recession starting in 2016, or one since for that matter.
So, what is the big talk about? It's that the yield curve is now inverted, and that is a recession signal. But recessions happen differently than this. Normally, as I pointed out before, the short term catches up with the long term because of Fed Policy. This movement here was not the result of Fed Policy. It is a variation that may be entirely within the normal fluctuations in the market. As in 2016.
Unless there is something else going on that isn't obvious in these numbers, then I'd say that this isn't significant. Not yet, at least.
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