Inversion!

Inversion ... of the 10yr-3mo spread.

 

Source: Bloomberg.

For context, see what has happened each time an inversion of 10yr-3mo has occurred.

Figure 1: 10 year-3 month Treasury term spread (blue), 10 year-2 year Treasury term spread (red), March 2019 observations for 3/22 noon, all in %. Three month rate is secondary market. NBER defined recession dates shaded gray. Source: Federal Reserve via FRED, Reuters, NBER and author’s calculations. 

For the implications, see Chinn and Kucko (2015). See also Klein (2018).

For implications for emerging markets, see Mehl (2006).

I hear that Mr. Trump is going to nominate Stephen Moore to be Fed governor. God help us all