Search Results for: negative yield

Global Real Yields Since 1805 Negative real yields are an “opportunity” for any government to refinance their debt. Image: Deutsche Bank

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. Image: Legg Mason

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…

Valuation – Average P/E for Stoxx Europe 600 and S&P 500 As equity markets rally and valuations climb, markets become more susceptible to negative surprises. This has led many investors and analysts to worry about stretched prices and limited margin for error. Image: Bloomberg

Global Supply of Safe Assets by Country – Shortage of Government Bonds The global shortage of government bonds is going to get worse and could keep yields low or negative. Image: Financial Times

Small Bank Lending and 2-Year/Fed Funds Spread This chart shows the correlation between small bank lending and falling rates, and the negative effect of an inverted yield curve on small bank lending. Image: TS Lombard

U.S. Bond Market Hedged and Unhedged Investors are frantically searching for yield, knowing that 25% of all bonds in the world trade at negative interest rates. Our world is aging with high levels of debt and low interest rates (maybe for a long time). Image: Fidelity Investments

What Indicators to Watch for Signs a U.S. Recession Is Coming? 1) In recent history, a recession occurs about 12 to 18 months after the spread between the 30-year and the 3-month treasury yields turns negative (red arrow). When an inverted yield curve occurs, short-term interest rates exceed long-term rates. It suggests that the long-term…