The Economy

The oil market (which might be the best indicator there is at a time like this) is certainly saying so.

We are facing a massive credit crunch -- even if central banks all pivot and think they can reinflate the bubbles. Amazingly, inflation is still very high (and will get worse if they DO pivot), so it's actually stagflation.

 

The yield on the 2-year note is just over 3.8 percent this morning. Just a week ago, it settled at 5.06 percent! (when Jay Powell was before Congress and talking hawkish -- trying to jawbone markets).

The market for U.S. government debt -- the most liquid, stable market in the world -- should not be experiencing those kinds of wild fluctations (which creates huge paper losses on a security that is supposed to move in small increments) on the front end of the yield curve. It CREATES instability. The Fed isn't controlling it, either, the Fed is getting dragged around by the market it supposedly controls to supposedly manage the economy.