To The Moon

Over the past years, the upside-down of U.S. Treasury bond yields has been the most recognized sign of economic recession in the market and an important indicator that is quite convincing. Therefore, whenever the two-year and ten-year treasury bond yield of the United States falls upside down, there are many voices saying that the economic recession is coming. However, the Federal Reserve previously took out a report saying that the upside-down of U.S. biennial and ten-year treasury bonds did not reflect any news of economic prospects. Everyone should pay more attention to the shorter-term interest rate curve. If the spread also turns negative, it means that the economic situation will become very bad, and the Federal Reserve may need to cut interest rates.

At present, in addition to the inverted "Figure 1" of relatively long-term U.S. treasury bonds, just as the Federal Reserve said, the short-term interest rate curve of concern has also been seriously reversed. After this situation in the past, the economic recession will generally be realized within an average of a year. From "Figure 2", we can see that the interest spread of the three-month national debt reduction in the United States in the ten-year period is becoming more and more obvious. So I think the Federal Reserve has nothing to say at present, because the yields on treasury bonds have been turned upside down, whether it is remote or short-term. I think Federal Reserve Chairman Powell should not have to argue again, right?

Assuming that the economic situation in the United States may become quite bad next, I think the current Federal Reserve is still facing a rather difficult problem. That is, at this stage, in order to curb inflation, it may be difficult for the Federal Reserve to fulfill its promise to cut interest rates when it needs to cut interest rates. That is to say, although the Federal Reserve has seen the short-term treasury bond interest rate curve upside down, it has no choice but to consider starting to cut interest rates, and even insist on maintaining the austerity policy, so I conclude that the economics There is no doubt that the fundamentals will become worse. Recently, I have chatted with some friends, including the service industry and the export manufacturing industry. Basically, everyone is in a similar situation. The demand is decreasing, and the orders are much less than last year. Although this is not a big data statistics, I think that the economic situation has declined at a speed visible to the naked eye, which is still a signal that needs to be vigilant.

However, what I have seen most people say recently is that the three major indexes in the United States, especially the Dow Jones Industrial Index, are still very strong. Everyone doesn't need to worry too much. They are afraid of my greedy idea, and every time I pull back, it will be increased. But to be honest, the rise and rebound are over. The early market is almost the same, but conservative investors who are conservative and happy to watch more may face completely different fates. If it is really rising and pulling back, conservative investors will make less money at most, but if the rebound is established, investors who like to watch more may spit out all the profits of this rebound. Therefore, it is everyone's homework to do when they see it well. There is often a rare increase in history, but it is usually a flash in the pan. It is not good to make big profits in the short term. The key point to keep profits after the rebound. In a word, short-term surges usually determine long-term profit performance, which I strongly agree with, but don't forget that short-term sharp declines will affect longer-term performance. After all, when you retake into the market, and even open the leverage to strive for short-term performance, unfortunately you encounter a collapse. As a result, the principal may be reversed, and the funds that can be used in the future will only become less.

Finally, the "Figure 3" data below shows the inverted ratio of long-term and short-term treasury bonds of the United States. The scope of this data statistics is to calculate how many treasury bonds with interest spreads being reversed. The treasury bonds include 30 years, 20 years, 10 years, 7 years, 5 years, 3 years, 2 years, 1 year, 6 months, 3 months and the shortest 1-month country. Debt. Long-term treasury bond yields are often used to check a country's economic prosperity and inflation, while short-term bonds are often used to predict a country's short-term interest rate decisions. As for the long-term and short-term spread, it can be used to check the probability of economic recession. When the more data this data, the longer the proportion of long-term and short-term public debt is inverted, then we can judge from it that in the near future, such as within a year, the probability of economic recession will increase. So is the current rebound of U.S. stocks reasonable? Whether it is a buying opportunity or not, I will leave it for everyone to evaluate and judge by yourself. I hope that investors can balance it with the comparison of return VS risk. Encourage it together

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