

Inverted Yield Curve and Recession?

- An inverted yield curve occurs when short-term debt instruments have higher yields than long-term instruments of the same credit risk profile.
Typically this shows that a recession is coming.
Investors feel they will have better opportunities to invest at a future date so they will invest short term, then they want their money back.
We can see this as a problem for Real Estate, this should bring down real estate prices as people move from a long term investment horizon to a shorter term one. They believe they will want their money at a closer time frame so they can use it for other investments.
Comments