Inversions are fun until they are not
It has been a great one plus year ride as the 2 year yield surpassed the 10 year yield but like all good things, they must come to an end.
Historically, when the "un-inversion" does finally come about (and it always does), there is a period of dizziness and nausea.
We are on that final loop-the-loop at this point. The 10 year yield will soon begin to rise past the yield of the 2 year yield.
A few people are talking about how the Fed will ride to the rescue and immediately begin to lower the overnight rate and start a new round of quantitative easing to stem the bleeding. I'm not so sure about that. It is a different world today than when Greenspan and Bernanke had the big chair at the Fed. BRICS was not yet an issue back then. The ratings agencies (Fitch, Moody's and S&P) would shit a brick. Buh-bye world's reserve currency status almost overnight.
