Turn on any financial news channel, read any investing website, or pick up a copy of the Wall Street Journal or Barron’s and they are all saying the same thing: “Danger, Will Robinson. Danger!” And much of that warning comes from the so-called inverted yield curve. The phenomenon is strikingly accurate at predicting future recessions and these days it’s flashing red.
But investors may not want to panic just yet.
Despite the yield curve’s history of being a leading indicator, it doesn’t work alone. There are other metrics that coincide with the inverted curve that predict recessions. And so far, those indicators are still bullish. For investors, this means we could still see some gains down the road and the time to abandon all stocks isn’t now.
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