Don’t Be Fooled by the Yield Curve

For the first time in at least 40 years, there’s a fundamental economic reason that a yield curve near-inversion might not herald a recession. The U.S. Treasury yield curve is currently flatter than usual, not quite inverted but close enough to make some people nervous – since, in the past, recessions have almost always followed. I will make the case that it’s likely to be different this time.

“This time is different” are the four words that make economic forecasters into monkeys, but see if you agree with my logic.