Treasury yields have plunged at the mid to long end of the yield curve producing biggest recession warning yet.
On Friday, US Treasury yields plunged at the mid to long end of the curve providing the most inversions since the start of the Great Recession. This is the biggest recession warning since 2007.
Major portions of the yield curve are inverted for nearly 15 years.
Let’s take a look at what others are saying.
Core Capital Goods
Durable goods orders April 2019 “Shipments of core capital goods were unchanged last month after a downwardly revised 0.6% decline in the prior month. They were previously reported to have slipped 0.1% in March.” Look out below on Q2 GDP estimates. https://www.cnbc.com/2019/05/24/durable-goods-orders-april-2019.html …
US durable goods orders fell 2.1% in April, vs 2% drop expected
That is something I pointed out as well in Dismal Durable Goods Report: Inventories Up, Shipments and New Orders Down.
Core capital goods are a measure of future business expansion. The March revision to the downside was massive, from +1.3% to +0.3%. April was -0.9%. Economists expected +0.1%. Oops.
Strong Economy Not
“There are still several economic data points that suggest the economy is strong…But we’ve seen enough in the way of negative layoff headlines and slowing manufacturing to indicate claims are the outlier…” @QuillIintel @YahooFinance — https://yhoo.it/2Wpn9kA
What the plunging 10-year Treasury yield says about the economy and stock market
The 10-year Treasury yield has major implications for the stock and housing markets.
GDP Assessment From Markit
PMI “Consistent with GDP Growing at an Annualized rate of Just 1.2%”https://moneymaven.io/mishtalk/economics/0eh2VUgFcE6TnaiEV7–Lg/ …
1.2% and falling
What’s the ECB Gonna Do?
Spotlight Trade War
What About Systemic Risks?
Dear Mr. Powell- Can you please tell us why a series of downgrades of BBB companies does not pose the potential for systematic risks.
Read our latest on the corporate bond market- The Corporate Maginot Linehttps://realinvestmentadvice.com/the-corporate-maginot-line/ …
Japan exports fall 2.4% while imports rise 6.4%.
South Korea Exports
South Korean exports continue to weaken suggesting further slowdown in US GDP.
Major Appliance Shipments
Look at this chart of major appliance shipments – collapsing 17% YoY in April – and tell me we aren’t heading into a recession.
Recession Already Started?!
US recession probably started in current quarter, Gary Shilling says, as Q1 real GDP growth, 3.2% at ann rates, was temporarily inflated by jump in inventories, which contributed 0.65ppts to growth. This was no doubt unintended & undesired as jumps in inventory-sales ratios show.