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Thread: Yield Curve Inversion - what does it mean and what should we expect?

  1. #1

    Join Date
    Jul 2004
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    http://money.cnn.com/2005/12/27/news...urve/index.htm

    To summarize/paraphrase:

    - This time is different than other inversions, since long term rates have stayed flat while short term ones have climbed - apparently in previous inversions, both ends of the yield curve were moving up, but the short term was simply climbing more rapidly.

    - Companies have been more cautious this year than in 2000 (year of the last inversion), with many of them flush with cash.

    - The financial sector won't be as hard-hit due to banks branching out into other non-lending activities such as asset management.

    - Interpret the inversion as a "flashing yellow light" but don't bail on investments (of course they'd say that - they want you in the market while they engage in profit-taking :P).


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  3. #2

    Join Date
    Dec 2004
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    amelia island, Florida, USA
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    Default

    asked a banker the other day how they can make money with this going on???
    he replied that the fees generated by refi's into the neutron loans ( arms, int. only, etc. ) was producing the lion share of the profits nowadays.
    the ? is how long can the banksters keep us guessing about the smoke and mirror money schemes????
    suppose the answer is as long as they want to since they control the money supply and rates.
    can you hear the helicopters in the distance yet???
    bernake is coming...M3 is to be concealed..LOL

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  5. #3

    Join Date
    Sep 2006
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    Default Re: Yield Curve Inversion - what does it mean and what should we expect?

    If fed rates were 'normal', we'd probably be seeing an inverted yield curve right now. Take a look at rates in the 30 year treasury. Everything is distorted with a .25% fed rate.

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