Many Happy Returns cover image

Dry Powder: Where to Park Your Cash

Many Happy Returns

CHAPTER

Why Is the Yield Curve in a Strange Place?

When you look at government bonds that the yield curve is in a strange place, isn't it? At least parts of it are inverted in the UK and I think in the US as well. If you then manage to get an interest rate from the UK government for a year, you'd usually get a much lower rate of interest than if you learned for 10 years or 20 years or 30 years. That makes sense, doesn't it? Because you think, oh, if I'm going to give my money and lock it up for 30 years, potentially, you better pay me for that. And that's called term premium. But at the moment, the term premium is negative, which is

00:00
Transcript
Play full episode

Remember Everything You Learn from Podcasts

Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
App store bannerPlay store banner