This series is for investors who are keen to understand the nuts and bolts of an economy. Now, investors are constantly searching for a reliable crystal ball that accurately predicts the future. While no indicator is perfect, one has come closer than any other: The yield curve. A specific, peculiar behaviour of the yield curve, known as an inversion, has preceded most major economic recessions in the US. When this happens, it’s as if the bond market – often considered the “smart money” in the room – is sending a powerful signal that economic trouble lies ahead. In this series, Macro the Mightiest, we discuss one macroeconomic factor every fortnight. Even a basic understanding will tell you when to react and when not to react to macroeconomic headlines.
