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Chart of the Week: 10 Year Yield (Post-Crash) vs Japan

Posted By Barry Ritholtz On June 6, 2005 @ 10:59 am In Fixed Income/Interest Rates,Psychology | Comments Disabled

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

10_year_versus_japan [1]


Rate Cycle:  Lower Lows, Lower Highs

Rate_cycle_lower_highs [2]

Charts courtesy of JDC

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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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Random Items

U.S. Bond Forecasters, Wrong on Yields in 2004, Blow It Again [3]

Upside-Down Interest Rates [4]   

What’s worrying Greenspan? [5]

Predicting Real Growth Using the Yield Curve [6] (PDF)

High Pump-Price Fairy Tales [7]

How not to buy happiness [8]   

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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 [9]

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

URL to article: http://www.ritholtz.com/blog/2005/06/chart-of-the-week-10-year-yield-post-crash-vs-japan/

URLs in this post:

[1] Image: http://bigpicture.typepad.com/.shared/image.html?/photos/uncategorized/10_year_versus_japan.jpg

[2] Image: http://bigpicture.typepad.com/.shared/image.html?/photos/uncategorized/rate_cycle_lower_highs.jpg

[3] U.S. Bond Forecasters, Wrong on Yields in 2004, Blow It Again: http://www.bloomberg.com/apps/news?pid=email_us&refer=home&sid=arC9NaZgmqSc

[4] Upside-Down Interest Rates: http://www.slate.com/id/2120161/

[5] What’s worrying Greenspan?: http://www.financeasia.com/Accessories/faPrintStory.cfm?objectID=2B304A6F-9027-7E17-4B3371C8DDCF39AA

[6] Predicting Real Growth Using the Yield Curve: http://www.clevelandfed.org/Research/review/jhaub.pdf

[7] High Pump-Price Fairy Tales: http://www.cato.org/research/articles/taylor-050603.html

[8] How not to buy happiness: http://mitpress.mit.edu/catalog/item/default.asp?ttype=6&tid=14403

[9] Martin A. Armstrong: http://www.armstrongdefensefund.org/martypei/buscycle.htm

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