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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (60152)	12/1/2006 12:40:22 PM
From: RealMuLan	Read Replies (1) \| Respond to of 116555

[Fed wish]--"Pay No Attention to that Yield Curve Behind the Curtain! Posted by David Gaffen blogs.wsj.com There’s a two-ton elephant in the room, and Federal Reserve officials are trying to convince people it’s a figment of the market’s collective imagination. The yield curve has inverted to a point where it’s putting pretty solid odds on a recession in the next year, but the campaign by officials — which began in early 2005 with Alan Greenspan’s “conundrum” speech — to tell people that the yield curve is different this time has been renewed with vigor of late. The difference between the 10-year note and the three-month Treasury bill has averaged about 0.48 percentage point in November, which, according to an oft-cited study by the New York Fed, puts the odds on a recession in the next 12 months at about 40%. Of course, Fed officials are arguing this doesn’t matter. “Everybody has their hopes and wants, and everybody hopes and wants to avoid a recession,” says Huge Moore, partner at financial advisory firm Guerite Advisors in Greenville, S.C. “Often, when the signal comes in strongly like it is now, there’s a human nature tendency to say, ‘this time it’s different.’” Bernanke That’s exactly what the Fed has been doing. ..."