This Recession Predictor Is Warning of Turbulence in 2025

This indicator is quickly moving toward the point where trouble happens. [Jeff Clark's Market Minute]( This Recession Predictor Is Warning of Turbulence in 2025 By Jeff Clark, editor, Market Minute Nobody cares about the inverted yield curve anymore. It used to be a big deal. After all, an inverted yield curve – when short-term interest rates are higher than long-term rates – has an excellent track record for predicting recessions. So folks who pay attention to it can avoid a lot of financial heartache. But the current inversion has lasted for so long, it feels normal. People aren’t worried about it. No one cares anymore. Recommended Link [Act by October 22nd: Discover Elon's Mind-Blowing New Invention!]( [image]( When you [click here]( you'll discover what Elon Musk's newest invention can do… And how it works… You might think it's straight out of a sci-fi movie. But Elon just conducted a real-life test on a human, and the outcome was astonishing. [Don't miss out – click here to see this presentation before Oct. 22nd!]( -- We should care, though – because the yield curve is quickly moving toward the point where trouble happens. Take a look at this chart… [chart] [(Click here to expand image)]( This chart shows the interest rate on the 10-year Treasury note minus the rate on the three-month Treasury note. Most of the time, this chart shows a positive number. That makes sense since long-term interest rates are usually higher than short-term rates. But the yield curve turned negative over two years ago. When it happened, lots of folks worried that the U.S. economy was headed toward a recession. After all, every other time the yield curve flipped negative, the economy contracted shortly afterward. But readers who look closely at the chart will notice that the trouble doesn’t happen when the yield curve turns negative. Instead, the problems occur when an inverted yield curve shifts back into positive territory. That’s what happened in late 2000 and late 2007. It happened just before the COVID-induced recession in 2020. And it’s what’s likely to happen when the yield curve turns positive again – which could be a lot sooner than most folks expect. The yield curve has been rising over the past month. It was -1.23 on September 15 – right before the Federal Reserve lowered its target for short-term interest rates. The yield curve is -0.61 today. Free Trading Resources Have you checked out Jeff's free trading resources on his website? It contains a selection of special reports, training videos, and a full trading glossary to help kickstart your trading career – at zero cost to you. Just [click here]( to check it out. In other words, the yield curve has recovered half of its inversion over the past month. Part of that is due to the Fed lowering short-term rates by 50 basis points. Part of it is due to the rise in longer-term rates. If we see similar action in the coming weeks, then the yield curve could be back in positive territory by Christmas, if not before. In fact, the fed funds futures market is already pricing in a 100% chance of the Fed lowering short-term rates another 50 basis points over its next two meetings. That’ll be just enough to push the yield curve back into positive territory. And if history is any sort of a guide, then the economy is headed toward turbulence in 2025. Best regards and good trading, [Signature] Jeff Clark Editor, Market Minute [Jeff Clark's Market Minute]( Jeff Clark Trader 55 NE 5th Avenue, Delray Beach, FL 33483 [www.jeffclarktrader.com]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. Jeff Clark Trader welcomes your feedback and questions. But please note: The law prohibits us from giving personalized advice. To contact Customer Service, call toll free Domestic/International: 1-800-752-0820, Mon–Fri, 9am–7pm ET, or email us [here](mailto:contactus@jeffclarktrader.com). © 2024 Omnia Research, LLC. All rights reserved. Any reproduction, copying, or redistribution of our content, in whole or in part, is prohibited without written permission from Omnia Research, LLC. [Privacy Policy]( | [Terms of Use](