Originally Posted by
TransWorld
My investment advisor and the Secretary of Commerce both stated the yield curve inversion is 1/100 of one percent. (Say 2.00% vs. 1.99%). This is hardly the inversions they have seen that leads to recession.
Yet the news media has picked up on this and are screaming recession, recession, recession. Remember blood and guts sells newspapers, as the old adage goes.
The Fed most likely will cut overnight rates when they meet next. This will bring the 2 year rate back down below the 10 year rate. The inversion will go away. The media will have to find something else to scream about.
Your investment advisor is spot on. He failed to mention that all the other duration measures of inversion already crossed and some like the 3 month/10 year are deeply inverted. The 2 year crossed yesterday and was the last to do so. So it reasons that the most recent event should look the least shocking.