Curve Concern

While the yield curve has inverted and the yield on the 10-year Treasury has fallen by half, it’s higher than in most of 2016 when it didn’t suggest a recession. The problem, in retrospect, was the Fed raised rates too much in 2018 thinking that the tax cut would do better for the economy than it did, and that the labor market was tighter than it was. Don’t freak out!

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