Wednesday, May 29, 2019 4:13 PM EDT
![](https://info.runnymede.com/hubfs/Bear_Market_Ahead.jpg)
This morning, the much-watched yield curve has inverted for the 2nd time with 10-year Treasury yields (2.27%) dropping below 3 month T-bill rates (2.36%). Many view the yield curve inverting as an early signal of recession. For those that view the glass as being half full, most people look for the 10-year vs the 2-year inversion and that hasn't occurred yet. Secondly, once the inversion takes place, the market often doesn't peak until months later. For those that view the glass as half empty, the inversion is a sign that the bull market is nearing an end.
(Click on image to enlarge)
![10 minus 3](https://blog.runnymede.com/hs-fs/hubfs/10%20minus%203.png?width=1200&name=10%20minus%203.png)
At Runnymede, we don't simply look at the yield curve but also over 50 other important variables that drive market conditions. We don't believe in a one-factor model. Taken on its own, this is a warning sign of increased volatility ahead and the bull market is likely on borrowed time.
The trade war with China will only cause more problems as it is increasingly likely to ripple through the global supply chain and slow economic growth. Not only did the yield curve invert in the US, but also in Mexico, Hong Kong, and Canada. Japan, New Zealand and Singapore are also dangerously close to inverting.
There are times to be aggressive and times to be defensive; we continue to believe investors are best to err on the side of caution heading into the second half of 2019.
Disclosure: Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no ...
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Disclosure: Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Runnymede Capital Management, Inc.), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Runnymede Capital Management, Inc. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Runnymede Capital Management, Inc. is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of Runnymede Capital Management, Inc.’s current written disclosure statement discussing our advisory services and fees is available for review upon request.
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