Yield Curve Inversion Pointing to Recession.

in #market5 years ago


In this report, I cover the early market action from London on Tuesday, December 4th, 2018. I look briefly at the precious metals, the stock market, the dollar, the bond market, and the oil price.

Today I look at what is happening in France as it seems like President Macron is losing control of things as the Yellow Jacket riots continue to rage on. My opinion of the events in France is that it is a symptom of an economic malaise that could spread to many other Western countries. It also points to the failure of our economic and political masters' strategy of MOPE or Management of Perception Economics.

I also look at the U.S. Treasury market yield curve and point out that the inversion we are starting to see at the short end and medium end of the curve is pointing to a possible economic slowdown or even recession in the near future.

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The economic and societal ducks are all lining up now - something big about to happen. Good clip. SirKnight.

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@maneco64, thank you for the report/video!
By the way, I don't think that the global economy is heading towards recession in the next 2-3 years. The economic data is quite positive. Yes, EU is experiencing at the moment some slowdown of growth...but it is because of extremely high growth in 2017. Yes, UK is facing some difficulties, because of the Brexit ahead. So, it is a kind of uncertainty for the businesses. But, the Global economy is doing quite well.

About the yield curve inversion. I don't think we have yield curv inversion. There is some kind of, so called, flattening. It is because the risk premia have been falling down. It is because the Global economy has been doing quite well in the last 2-3 years. Yeah, the are many other factors, but those are the main ones.
About the yield curves flattening...analysts expected it 2-3 years ago, including myself.
About the US indices. This is the beginning of sideways movement, or call it a Range formation. I think the the indices will trade in a quite broad Range for the next 3-5 or 6 years. The upper bound will be at about 3000 for S&P500 (+- a few %). But I am still curious to see where the lower bound will be. So, I don't see any recession in the next 2-3 years.

Happy Steeming!

Awesome video, I really learned some stuff today from this that I didnt really think of or know before in terms of how to view these ups and downs in the market and how it affects people on a socieo-economic level.

Bailing out these banks are bad. If they are going to feed into the shitty policies of the government, then when the next recession hits they should spiral down and dissolve and let better, more adapted systems and competitors take their place. In my opinion, it's time to let the market evolve with the new pressures instead of trying to pump life into crappy things that consistently have failed the people for the last couple decades with all these recessions over and over again, closer and closer together.

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Thanks for sharing about that.
Question, how you see the mainstream investments in Europe with the huge quantity of credit in market and the gears of market stopping? Is that a new 1929 recession?
Cheers!

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