Tuesday, December 22, 2009

Update on the Yield Curve

The yield curve as of today is shown above as compared to October. Note the increase at the top end and the decrease at the bottom. It is the steepest yet.

The data above depicts the key elements over the past nine months. The yield for the long term debt is increasing at the top end. The low end is still dominated by easy money from the FED.

The curve above depicts the rapid decline at the low end while sustaining the high end or long term growth.

The spread of the 10 year and 3 month rates is shown above. We see that spread peaking again.

We anticipate continued growth in the top rates as inflationary pressure grows.