Just when people think that US is impervious to the problems that has plagued the Emerging Markets since the start of the year, the day of reckoning finally came as the US stock market joined the Europe and Emerging Market counterparts and plunge into correction zone.
The first question investors have been asking since the start of the fall – “Is this the start of the bear market?” Let us look at some market indicators to help us estimate how far we are in the economic cycle.
US Treasury Yield Curve
The US treasury yield curve is a comparison of the interest rates offered by bonds of different maturity. The longer dated bonds typically give higher interest as it pays investors more for the higher risk they take for depositing the money with the US government. An inverted yield curve is when the short term interest rates is higher than …