In light of Mike’s recent commentary on how the yield curve seems to be forecasting powerful economic growth, I wanted to make you aware of a great tool at StockCharts.com that allows you to watch how the yield curve has developed this decade. Click here, and then click “Animate” to watch how it has changed over time.
You will notice that the yield curve was inverted or flat for most of 2006, 2007, and the early part of 2008, correctly predicting big trouble ahead. Right now, the difference between long and short Treasury rates is as wide as any time in history, signaling powerful economic growth ahead.
Larry Kudlow also has a nice commentary in NRO on the yield curve that is worth the read.
