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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: Crimson Ghost who wrote (22937)2/5/2005 10:59:49 AM
From: mishedlo  Read Replies (1) of 116555
 
Obsession with Interest Rates
[This is a very interesting article. Mish]

The most accurate predictor of a recession is an inverted yield curve in which short-term rates are higher than long-term ones. The United Kingdom is already facing this as its 3-month interest rates are 4.72% and 10-year rates are 4.55%. I foresee the United States having an inverted yield curve by the end of the year if the Fed continues down its rapid tightening path. How will this present itself ? Short-term interest rates going to 3.50% and the 10-year Treasury security?s yield dropping to less than 3.50%, far below the consensus estimate of 5.10%. So there?s my call. Then again, things change.

cwscapital.com
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