Brandywine Global portfolio manager Jack McIntyre was on Fox News to discuss and provide market insight as to why the Federal Reserve should focus on the flattening Treasury yield curve.
- Flattening yield curves could invert, causing the 2-year yields to be higher than 10-year yields – a condition that typically precedes a recession
- The inverted yield curves preceding a recession were evident in the Dot Com Bubble and the Housing Bubble the past 30 years
- The current yield curve is telling two things: Inflation is not a concern and growth should be watched carefully
- Flattening yield curve points signals Fed to slow down on raising interest rates
- Investment opportunities could be had in long end of the yield curve
- Opportunities: 30-year U.S. treasuries, Japanese government bonds, contrarian emerging markets bonds, and Latin American/Asian commodity producers
For more trends in fixed income, visit the Fixed Income Channel.