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October 28, 2023 | Re-Steepening Yield Curve Signals Financial Trauma in Motion

Danielle Park

Portfolio Manager and President of Venable Park Investment Counsel ( Ms Park is a financial analyst, attorney, finance author and regular guest on North American media. She is also the author of the best-selling myth-busting book "Juggling Dynamite: An insider's wisdom on money management, markets and wealth that lasts," and a popular daily financial blog:

In the past few months, short-term treasury yields have risen more than long-term such that the yield curve, which has been inverted since April 2021, is now un-inverting. This move typically signals the near-term onset of recession and the worst stock market losses.

The chart below from my partner Cory Venable shows the move in the US 2-10 yield spread from a deeply negative 108 basis points in June 2023 to -22 this morning. Past re-steepening episodes are highlighted in blue, with the recessions that followed in red.

Komal Sri-Kumar, president of Sri-Kumar Global Strategies, joins ‘Squawk Box’ to discuss rising Treasury yields, with the 10-year Treasury yield breaking above 5% for the first time in 16 years, the impact on markets and economy, the Fed’s inflation fight, and more.Here is a direct video link.

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October 28th, 2023

Posted In: Juggling Dynamite

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