In my 50-plus years of running money, I’ve noticed that the biggest market moves come from factors that have gone unnoticed – and right now, there’s a doozy lurking under the table.
Amid all the tariff tumult of the past few months, the global yield curve has been quietly re-steepening. Also note that the previously long-watched US-based yield curve – which investors lately (and wrongly) have been ignoring – has been doing the same.
So what’s a yield curve, again? It’s a graph showing government bond yields from 3-month to 10-year, left to right. When long-term rates top short rates, the curve slopes upward — and is deemed “steep” and historically bullish. When short-term rates top long, it is “inverted”— an historically fairly reliable though imperfect recession warning.
The biggest market moves come from factors that have gone unnoticed – and right now, there’s a doozy lurking under the table. AFP via