3min chapter

Forward Guidance cover image

Jim Bianco on Fed Chair Powell's Reluctance To Discipline The Bulls (February 2023 FOMC)

Forward Guidance

CHAPTER

Is the Yield Curve Projecting a Recession?

In an inverted yield curve, the highest inflation rate is short-term interest rates and then each longer one gets lower. It has a 100% track record of leading recessions but we're still seven or eight months away from the start of the recession. Does this market have the patience to wait out a slowdown and a Fed pivot? I don't think it does. And if they don't get it in June, they're going to get very disappointed by the point that June comes along.

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