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U.S. Treasury yields were higher on Thursday morning, extending gains even as the closely watched 2-year/10-year yield curve remained inverted — a key recession signal.

The yield on the benchmark 10-year Treasury note rose over 6 basis points to 2.979%, while the yield on the 30-year Treasury bond was up 4 basis points to 3.165%. Yields move inversely to prices, and a basis point is equal to 0.01%.

Market pros track the spread between longer-duration Treasury yields and shorter-duration yields, with the former typically higher.

“Seven years of great abundance are coming throughout the land of Egypt, ³⁰ but seven years of famine will follow them.” Genesis 41:29

However, the 2-year Treasury yield climbed 15 basis points to 2.967% on Wednesday, holding above the 10-year. That so-called inversion, particularly if sustained, is often interpreted as a warning sign that the economy may be weakening, and a recession could be on the horizon.

The 2-year to 10-year curve first inverted on March 31, then again briefly in June.

Treasury yields pushed higher on Thursday after moving higher in the previous session on the release of the latest Federal Reserve meeting minutes. The documents showed that the central bank was leaning toward another 75 basis point rate hike this month as it focuses on bringing down inflation.

Read More @ CNBC HERE

Consumer confidence has plummeted already. With gasoline and food prices weighing on far more than American sentiment, it’s no wonder much of the public may have come around to the idea of recession. Politicians and economists are another matter. Nothing in life—let alone the economy—is inevitable, but the entire global system may have passed that point of no return some time ago before anyone (outside of markets) had realized it.

“And I heard a voice in the midst of the four living creatures saying, “A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not harm the oil and the wine.” Rev. 6:6

Treasury yields and eurodollar curves have been forecasting contraction not inflation for well over a year already. Starting out as small relative probabilities, as longer-term yields buckled and the eurodollar curve distorted, this was just the markets’ way of signaling a higher degree of confidence in this pessimism.

It all broke wide open, so to speak, once already shameful gasoline prices took a step too far around the beginning of March. In all likelihood, that was the point of no return.

Since then, these same markets after having moved on from “if” to “when” are now thinking especially hard about “how bad.” And this is where recent data fits in.

Unfortunately, various major and minor economic statistics around the world have rather unsurprisingly confirmed these market suspicions. First, a slowdown rather than acceleration in the middle of last year when the public’s attention was exclusively fixed on what “everyone” said was big inflation.

That slowing was a warning it had only ever been “inflation” (supply shock, not excess money) which meant it all came with an expiration date (yes, transitory). This unappreciated 2021 downturn was picked up in all the data, too, including U.S. (and overseas) real GDP.

Then, like curves, GDP changed for the worse during 2022’s first quarter. In America, the Bureau of Economic Accounts (BEA) said output adjusted for prices (real) fell rather alarmingly in those three months. The final revisions to Q1 were released just now and were even weaker than previously thought (below).

Read More @ Zero Hedge HERE