Friday, May 31, 2019

Yield curve watch

Evidently, there are a lot of people out there who seem to think Trump's economic policies are wrong.

However, the statistics on GDP and employment are still pretty good.  Something doesn't add up.

The yield curve is nearly fully inverted now.  It doesn't make a whole lot of sense.  If the economy is growing this well without inflation, interest rates shouldn't be this depressed.

What gives?  Does somebody know something that I don't know?  As for basic economic theory, puhleeze.  I've seen it all before.  I don't need those kind of lectures.

The only thing I can figure is manipulation.  The manipulation may produce a self-fulfilling prophecy.  However, it is hard for me to believe that near zero interests rates are too high!

In other words, it's worth keeping an eye on, but not to panic over it.


No comments: