Where are We in the Cycle?
Where are We in the Cycle?
Where are We in the Cycle?
Where are We in the Cycle?
10- Year Treasury Minus 2-Year Treasury
- The business cycle is difficult to predict as there are many moving parts
- But, a pretty good indicator is available by monitoring 10-year treasury yields minus 2-year treasuries
- This difference has predicted at least five recessions over the last 40 years
- When 10-year treasuries go negative against 2-year treasuries, a recession usually occurs within the short term (generally, 10-15 months later)
- Over the last couple of years, this dynamic has trended lower and now stands at its lowest point since the recession of 2008/09
