, Columnist
The Treasury Yield Curve Isn't Telling Investors Much
Watch for excess private investment. That's when the economy is susceptible to a fall.
The Treasury yield curve is a closely watched metric for good reason. But investors fixating on it right now may miss the bigger risk.
In each of the last two economic cycles, the yield curve flattened and then inverted -- meaning short-term interest rates became higher than long-term interest rates -- in the period leading up to recession. The curve is flattening now, and could invert next.