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Chart of the Week: Yield Curve

Posted By Barry Ritholtz On September 27, 2004 @ 11:18 am In Finance | Comments Disabled

Looking at the past two decades, whenever the Fed has started tightening AND the yield curve has flattened, it has presaged a downturn in economic activity, as reflected in the ISM.

That is exactly the situation we find ourselves in at present:

Federal Reserve, Yield Curve and the Economy
click for larger chart
Panzner_fed_yield_flatten [1]
chart courtesy of Michael Panzner, Rabo Securities

Panzner used this measure because it has had a pretty good correlation with swings in year-over-year Gross Domestic Product data during the period.

Random Items:
Signs of listless economy persist [2]
The Two-Income Trap [3]
Inside Kerry and Bush’s Technology Agendas [4]
The Longevity Gene [5]
British firm finds the nuclear industry’s ‘holy grail’ [6]
Iran asks the world to nuclear party [7]

Quote of the Day:
“The work of the individual still remains the spark that moves mankind forward.”
-Igor [8] Sikorsky [9]


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2004/09/chart-of-the-week-yield-curve/

URLs in this post:

[1] Image: http://bigpicture.typepad.com/photos/uncategorized/panzner_fed_yield_flatten.jpg

[2] Signs of listless economy persist: http://www.suntimes.com/output/business/cst-fin-econ24.html

[3] The Two-Income Trap: http://msnbc.msn.com/id/3079221/%5D

[4] Inside Kerry and Bush’s Technology Agendas: http://www.pcmag.com/print_article/0,1761,a=135747,00.asp

[5] The Longevity Gene: http://www.technologyreview.com/articles/04/10/scanlon1004.asp?trk=nl

[6] British firm finds the nuclear industry’s ‘holy grail’: http://news.telegraph.co.uk/news/main.jhtml?xml=/news/2004/09/26/nnuke26.xml&sSheet=/news/2004/09/26/ixhome.html

[7] Iran asks the world to nuclear party: http://www.atimes.com/atimes/Middle_East/FI24Ak02.html

[8] Igor: http://www.time.com/time/magazine/archive/covers/0,16641,1101531116,00.html

[9] Sikorsky: http://www.sikorskyarchives.com/

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