We May Not Be Getting That Economic 'Soft Landing' After All

[Ptarmigan]

We May Not Be Getting That Economic 'Soft Landing' After All
https://redstate.com/joesquire/2023/10/04/we-may-not-be-getting-that-economic-soft-landing-after-all-n2164662

There are now some major warning signs that the "soft landing" some experts assumed was coming as far as the economy is concerned may not be coming after all, and it's causing concern among economists.

The biggest clue appears to be what's happening with the bond market in the U.S.

Bond yields are now in the high 4 percent range, and could get into the 5 percent range before much longer. It's creating instability in the market, and the result is that more economic pain is likely coming. According to some analysts, part of the problem appears to be that no one has been right about what's going to happen next.
Yields on the 5-year and 10-year Treasury notes, as well as the 30-year Treasury bond, hit their highest levels since 2007. The 10-year Treasury yield reached 4.8% on Tuesday. Bianco sees 4.5% as fair value.

“We’re just a little bit above fair value right now. I think what you see in the bond market is a capitulation,” noted Bianco. “Most of the year bond investors [and] bond managers have been long. They’ve been trying to argue why we’re going to have a recession. Why there’s going to be a rally. And, they’ve been getting their brains beat in, and they can’t take it anymore.”

The volatility in the bond market is extending to stocks. The Dow Jones Industrial Average saw its worst daily performance since March and is now negative for the year. The S&P 500 and the Nasdaq Composite also closed the day more than 1% lower.

There was never going to be any soft landing.