U.S. Share of Global Investment-Grade Fixed-Income Yield With negative yields in Europe and Japan, the U.S. now accounts for 95% of the positive investment-grade yield. Picture source: Legg Mason
S&P 500 Operating EPS vs. USA National Income, Corporate Profits Thanks to buybacks, this chart clearly shows the current divergence. Is a new bubble being formed? Picture source: Nordea and Macrobond
Global Fixed Income Market In Different Yield Buckets Nowadays, the scarcity of yield with 20% of global bonds below 0%. Picture source: ICE Data Indices, Bank of America Merrill Lynch
Lower Incomes Paid the Highest Price Low-income groups are slowly recovering after the financial crisis. Inequality: you may also like “U.S. Net Worth by Wealth Bracket.” Picture source: Deutsche Bank Global Research
Income Shares of the Top 1% in Various Countries The richest 1% of Americans take 20% of national income, but the richest 1% of the Dutch people only 6%. Denmark and the Netherlands are the countries that are the most equal. Picture source: World Economic Forum
Smoothed U.S. Recession Probabilities Currently, the probability of recession is 0.88%. When this recession indicator exceeds 5% (red line), history tells us that the probability of recession is increasing. The chart shows the smoothed U.S. recession probabilities indicator on a log scale. Smoothed U.S. recession probabilities are obtained from a dynamic-factor markov-switching model applied to four…
U.S. Net Worth by Wealth Bracket Another chart showing the wealth disparities before and after the Great Recession. Inequality: you may also like “Lower Incomes Paid the Highest Price.” Picture source: Axios
BBB Debt by Sector in the U.S. By sector in the U.S., financial institutions have the largest amount of ‘BBB’ debt: $744 billion. That’s 53% of investment-grade bonds in the United States. You may also like “The U.S. Corporate Bond Debt Rated ‘BBB’ Exceeds $3 trillion.” Picture source: S&P Global Fixed Income Research
New York Fed Probability of Recession in Next 12 Months since 1990 When an inverted yield curve occurs, short-term interest rates exceed long-term rates. It suggests that the long-term economic outlookis poor and that the yields offered by long-term fixed income securities will continue to decline. Since 1962, no recession has occurred without an inverted…
Yield Curve Inversion, How Long Until The Recession? In recent history, once the 10-Year minus 3-Month Treasury yield spread is negative and hits 10 consecutive days, it persists for weeks/months. When an inverted yield curve occurs, short-term interest rates exceed long-term rates. It suggests that the long-term economic outlook is poor and that the yields offered…
