Even in this recovery with near zero Fed Funds, job growth was weak and wage growth never materialized.

What will the next recovery look like? 

Post Bubble Yields: U.S. 10 Year(Post-2000) vs Japan (Post-1989)

click for huge chart


Rate Cycle:  Lower Lows, Lower Highs


Charts courtesy of JDC


The stimulation for the next recovery might be even more limited, given the extremes in current leverage and rates. If we follow the Japanese model, stocks could go down for several years, bonds go up even further, as the dollar rallies, materials and energy stocks do poorly. In this scenario, Gold diverges from the dollar and rallies strongly.


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Quote of the Day

The greatest booms unfold when capital concentrates in one sector. When that capital shifts, you also find the result of the greatest financial panics in history.

Martin A. Armstrong


Category: Fixed Income/Interest Rates, Psychology

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

4 Responses to “Chart of the Week: 10 Year Yield (Post-Crash) vs Japan”

  1. Chris says:

    If bonds make new highs from here, won’t that continue the housing boom?

    And if the housing boom continues, won’t it provide more fuel for the stock market?

  2. Its not so much that Japan is pulling the US down, as their experience post 1989 crash sets an example of what we may be in for.

    If you believe that marekts are merely a result of human activity, and that is only a reflection of Human nature, well the next step is that all of these crashes — 1929, ’89, and 2000 should look roughly parallel . . .

  3. Mark T says:

    surely the comparison is europe and Japan?

  4. shikha says:

    Want more knowledge.