# Inverted Yield Curve... Again



## wayneL (25 July 2006)

This slipped past me. Normally I keep an eye on this, but as this brief article points out, it is being treated as a non event.

http://tickersense.typepad.com/ticker_sense/2006/07/inverted_yield_.html

This makes it all the more significant IMO.


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## Knobby22 (25 July 2006)

I think bond investors are expecting a recession within three years, maybe less. 
Note, the yield curve is strongly positive for 6 months and then backs off becoming reasonably but not yet strongly negative.


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## Kauri (25 July 2006)

I actually have it showing as flat at the moment.


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## Freeballinginawetsuit (27 July 2006)

Hey Gero guy, I live in Wandina, Cheers!  . Back to your point, is the curve being inverted good or bad?


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## wayneL (13 November 2006)

A couple of articles from Barry Ritholtz on inverted yield curves and recession risk

Yield Curve Says Probable Recession 

Other Factors Contributing To Increased recession Risk 

And just for Icing on the cake:

Bushwacked on the Economy


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## Kauri (13 November 2006)

Wayne..
     Back in 2000 the yield curve was inverted from Feb through to Nov whilst the market topped and levelled off, and then the market corrected sharply. If it follows that pattern again,     Has been flipping back and forth between normal, flat, and inverted this year, can't seem to make up it's mind. (Last two weeks have been inverted). Watching with interest.


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## maffu (13 November 2006)

Freeballinginawetsuit said:
			
		

> Back to your point, is the curve being inverted good or bad?




My understanding is that an inverted yield curve generally occurs when inflation is becoming a problem, and as Inflation can lead to recessions if you are holding long positions and dont want to be unemployed, then i guess an inverse yield curve could be bad.


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## Kauri (26 January 2007)

The Yield curve has now been inverted in all but 2 weeks (when it was flat) since Nov 7...


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## Smurf1976 (26 January 2007)

Kauri said:
			
		

> The Yield curve has now been inverted in all but 2 weeks (when it was flat) since Nov 7...



Whilst house prices are falling in many areas, two Australian states are either officially in recession or damn close to it, oil prices have slumped and US economic growth has dropped 70% or so during 2006... 

All we (don't) need now is a war...


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## Kauri (26 January 2007)

Smurf1976 said:
			
		

> All we (don't) need now is a war...





  Article from Jan24......   :sword: 

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Does aggressive SPR build-up foretell Iran strike? 

Light sweet crude is down 20 cents at $54.80 per barrel, after Tuesday's $2.48 jump to $55.04 on reports that the US Dept of Energy will purchase 100K barrels of oil per day starting next spring. While the decision is part of the Bush Administration's latest commitment to reduce US dependency on imported oil, the aggressive approach on beefing up SPR may reflect heightened possibility of a US military strike against Iran as early as March or April, at a time when US navy ships are piling up in the Persian Gulf. Yesterday, markets were filled with chatter of a Kuwait-based newspaper article reporting that the US will launch a military strike on Iran before April 2007, citing “reliable sources”. According to the article, the strikes will be launched from US ships with Patriot missiles guarding all oil-producing countries in the region. The attacks would be planned in April, the last month of British PM Blair in office. The immediate result of such an attack is a protracted run up in oil prices, which could reach the $70 per barrel mark in less than a week.
		
Click to expand...


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