US Long-Term Mortgage Rates Decline: 30-Year Average 4.10% & 15-Year Average 3.57% Why US long-term mortgage rates decline? Mortgage costs are influenced by the 10-year Treasury yield which was lower this week, because the trade war between the United States and China pushes investors moving money from stocks to bonds. Bond yields fall as prices rise.…
One of the Best Yield Curves to Predict a Recession is Coming The spread between the 30-year and the 3-month treasury yields is one of the best recession signal of all the yield spreads. In recent history, a recession occurs about 12 to 18 months after the yield curve inverts. When an inverted yield curve…
Are We Near a Recession? “The leading index for each state predicts the six-month growth rate of the state’s coincident index. In addition to the coincident index, the models include other variables that lead the economy: state-level housing permits (1 to 4 units), state initial unemployment insurance claims, delivery times from the Institute for Supply…
Are US-China Trade Talks “Going Very Well” As Donald Trump Says? Well, in 2018, China was selling its US Treasury securities. In 2019, it’s just the opposite. Not bad! Why? It is not obvious, but China could use the dollars elsewhere, in Middle East countries for oil supplies, instead of buying US Treasury securities. Image: Ryan Detrick,…
Why the Current Business Cycle Can Continue? Even if we are in a late business cycle, real Fed funds rate is near zero, the Fed remains “patient” at the moment and has little influence on the long end of the yield curve. The 30-Year Treasury Rate minus 10-Year Treasury Rate spread has a normal upward…
Why Warren Buffett says that stocks are generally better than bonds? Our equity risk premium model shows when the US stock market return for the next 10 years is more or less attractive than the 10-Year Treasury Note. Since 1970, the 10-year Treasury Note was less attractive than the US stock market over a 10-year…
Yield Curve Inversion A yield curve inversion is a necessary condition for a recession, but it is not a sufficient condition. We also need a widening of credit spreads and higher real interest rates. And currently, the long end of the yield curve has a normal upward slope. You may also like “Why the Current Business…
https://www.isabelnet.com/wp-content/uploads/2019/03/stock-market-equity-risk-premium.mp4 This fabulous model shows if the US stock market return for the next 10 years is more or less attractive than the 10-Year Treasury Note The US stock market equity risk premium is the US stock market excess return for the next 10 years over the US 10-year Treasury Note. This is the premium…
PREMIUM MEMBERSHIP – Click the Images to Enlarge Video tutorials are available by clicking on this link: “FORECASTING MODELS” located in the menu bar at the top of each page. Our daily Stock Market Bull and Bear Indicator is available in the Pro Membership. Upgrade your Premium Membership to a Pro Membership Now! The period of…
PRO MEMBERSHIP – Click the Images to Enlarge Video tutorials are available by clicking on this link: “FORECASTING MODELS” located in the menu bar at the top of each page.