Alert in the United States. The yield curve is inverted. Across the Atlantic, the new one has a clear meaning for the common man: a recession is announced! Donald Trump immediately responded on 14 August last year, when the rate of Treasury bills of two years became higher than the rate ten years ago. The president, who does not want to hear talk of a slowdown in the u.s. economy, which has been cracked by a tweet that pissed off about this "CRAZY INVERTED YIELD CURVE" ("crazy rate curve reversed"), in capital letters! The phenomenon is new product Thursday.

..Spread is way too much as other countries say THANK YOU to clueless Jay Powell and the Federal Reserve. Germany, and many others, are playing the game! CRAZY INVERTED YIELD CURVE! We should easily be reaping big Rewards & Gains, but the Fed is holding us back. We will Win!

— Donald J. Trump (@realDonaldTrump) August 14, 2019

Why so much hype? The economic literature demonstrates a relationship between the yield curve and the growth since the late 1960s. Each time that the short-term rates became higher than long rates, the United States has been hit with more or less short term by a slowdown. For example, the spread between the rate to ten years and rates at three months became negative between August 2006 and ...