inverted yield curve

free4440273

I agree that everybody seems to be 'fighting' their own little corner here (without the fisticuffs!). But for me, an inversion of the yield curve is just that - an inversion! Fed will raise rates perhaps twice more; BoE will follow in tandem. The bounce-back in the housing market will help justify this, along with people's spending habits - some people only learn the hard way it seems...

cloud_dog

free4440273 wrote:

I agree that everybody seems to be 'fighting' their own little corner here (without the fisticuffs!). But for me, an inversion of the yield curve is just that - an inversion!

Ok, if you say so but the link I posted indicated that the likelyhood of this happening is lessening. Feel free to post information / links. Having said that I am feeling 'edgy' towards the markets.

Fed will raise rates perhaps twice more; BoE will follow in tandem. The bounce-back in the housing market will help justify this, along with people's spending habits - some people only learn the hard way it seems...

Sorry free but the interest rate cycle between the UK and the US (in fact europe and others) seem to be out of synch. In fact there are some who feel there may still be a rate cut left in the BoE this year whereas 'they' say that the US are likely to raise but with a longer term view that they will drop, i.e. they are near the top of their interest rate cycle.

As I said I would luv to be able to picture / analyse your thoughts better so if you do have any info / links. charts, etc,etc please post.

Thanks cloud_dog

ManAtHome

Regardless of yield curves - UK Ltd has only been keeping it's head above water due to:
a) consumer debt increasing at twice the rate of earnings and
b) GB(H) adding a million or so public sector posts in the last 8 years

anyone think this can go on forever..?

ReportInvestor

Gordon's hoping for 3 more years .

You're right about the extraordinary boost to the economy given by equity release.

The figures are mind-boggling.

EdInvestor

Fed will raise rates perhaps twice more; BoE will follow in tandem.

In this case, IMHO it's the other way round. I agree it's a possibility there will be another cut here, but the housing market looks to be bouncing back, at least in London, so that reduces the likelihood, as the BoE will be wary of reigniting the boom. So no change might be the outcome for the moment: a rise is out of the question IMHO because there are some very droopy bits of the economy ( retail spending in particular and unemployment has ticked up) which could be badly impacted. The former however would be helped by a bit more bounce on the property side.

As usual lately, the picture's not really very clear, leavig room for plenty of lobbying. .

free4440273

put simply, some people [myself] believe a nasty and unprecedented recession will be with us 'soon'; others think the status quo will continue...

cloud_dog

free4440273 wrote:

put simply, some people [myself] believe a nasty and unprecedented recession will be with us 'soon'; others think the status quo will continue...

Free

Your posts intrigue me but, to be honest if this was an investment BB you'd be accused of being a ramper or a shorter due to your posts being relayively light on facts and documentary reference.

Would it be possible for you to post some info or links, perhaps to a model / chart of your inversion curve (have been unable to find one, unfortunatly inversion curves happen in an awful lot of fields - physics, chemistry, biology, etc,etc).

cloud_dog

al_yrpal

cloud_dog

He won't so I will - http://www.investopedia.com/university/advancedbond/advancedbond4.asp

although its not necessarily a predictor of a recession.

Batten own the hatches!

Deemy

With inflation around the world on the rise as evidenced by commodity price inflation, some time down the road this will show up in RPI and then the pressure for rates to rise.

Whether that will lessen the inverted yield curve depends on whether its a case of stagflation or whether the raising of rates beings inflation under control and thus support the inverted yeild curve.

I don't know Just that Ive noticed that the goverments have become more competent at managing the world economy in the face of potential disasters i.e. crude going to $70 etc...

exil

That's my impression. We still have recessions (ie the Far East bust in the 90s, the post-9/11 dip) - but they're just not as severe as the ones in the past. Are Brown (and other finance ministers, regardless of political party) just better at steering the ship of state, due to the computers chugging away in the treasury?

Afraid I don't believe the OP has any more idea if and when we'll have a recession than I do. Does he/she have a track record of buying low and selling high at just the right time in the past? If so he/she should be a billionaire by now.

Reminds me of people who predict housing price crashes. Who thinks house prices are going to crash? You, sir? OK - can I buy your house today at 75% of its market value? No? I wonder why not? If your house is going to be worthless in a few months, why not take the money and run?

That is - predictions of busts (or booms) are easy to make. ACTING on them
is the difficult trick.