long-term money. hold on. bottom line, if you don t want to get into the details of how or why that happened, here s what you need to know. from a historical perspective, when that happens, when the yield curb reverts, that is a precursor for a recession to come in ten-plus months. that s why it matters. i understand why it matters, but why did this only happen this morning? why did that ten-year become lower interest than the two-year? you know how a lot of people put their money in the stock market. when the stock market is uncertain, where does it go? you put it in bonds. when a bond price goes up, the interest rate goes down. it s an inverse relationship, so what you re seeing is what s called a flight to safety. people are leaving the stock market, piling into the bond market government bond market. government bonds, gold, safe havens. finally, what is it going to take to bring back a little stability? maybe stability brings back
happened in argentina two days ago. look what s happening in hong kong. we know that brexit is on the horizon in europe. across the world, there is not really a safe haven of stability. tack onto that the lack of clarity from our administration, whether it s trade policies or foreign policy in general. it s really unclear what the president s intentions are, and for investors or corporate america, if they can t see a clear path, they sit out. i know you talked about this a little bit in your hour, but explain this to ordinary people who may not understand what is at play when you are talking about going to bed yesterday the market is up, waking up this morning and suddenly something has happened. one extra thing has happened and it s a significant thing. this is the yield curb. the idea that if you invest money for the short term, you get a short interest rate, if you commit for the long term, you get a bigger interest rate. typically the yield curb means lower interest for short t