19 August 2019 — Michael Roberts Blog
As the stock markets of the world gyrate up and down like a yo-yo, all talk in the financial media is on whether a new global recession is coming and when. The financial pundits search for economic or financial indicators that might guide them to tell. The favourite one is the ‘inverted bond yield curve’. This is the difference in the annual interest rate that you get if you buy a government bond that has a ten-year life (the maturity before you get your money repaid) and the interest rate for buying either a three-month or two-year bond.