What is this graphic about? I have no idea and would like to learn...

What is this graphic about? I have no idea and would like to learn, can someone here explain the whole thing as if I don't know shit? because I don't.

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retard doomers like to fantasize. yield curves inverted 2005 and 2006 and markets had a big ass bullrun to fuck over their puts for over a year. same many such cases, and will happen in todays market

yeah i can explain. basically the kikes are fucking everyone over as usual.

what are yield curves though? and what does it mean if they're inverted?

Just fucking google it

Your WEBM literally goes flat within the first second but ignores the fact because no recession followed.
The trend is remotely meaningful - but so many people are talking about it right now that it may have unironically already been half priced-in.

Bonds with shorter dates until maturity should really always have a lower interest rate because they represent lower risk. If a 10 year bond annual interest rate was the same as a 1 year bond, why not choose the more liquid option?
Further into the future makes the asset more risky to hold - risk of defaults, high inflation, etc.

Under what circumstances would a 1 year bond have a higher yearly return associated with it than a 10 year bond?
Probably when we expect any of the above risk indicators to hit quite soon and for quite a short amount of time.

Example: a one year bond with a 5% annual gain versus a 5% 30 year bond.
If we were expecting 0% inflation for the next 30 years, but for whatever news now expect 5% inflation next year, and then a return to zero percent for the 29 years after that time, the real profit for buying the one year bond right now falls to zero ($1 * 1.05 [return])/1.05 [inflation]
On the other hand, the average yearly real profit rate for the 30 year bond becomes ($1 * 1.05^30 [return])/1.05 [inflation], or your $1 would become just over $4 over 30 years, which would then be worth about $3.80 in real terms.

Obviously, the one year bond has become a useless investment, while the 30 year hasn't really taken a hit.

Nonetheless, economic phenomena have ridiculously many relevant factors, far more than I could go through in about ten posts of this length.

The government is paying more for short term bonds than they are for long term bonds , which makes no logical sense.
The general idea is they do not want people locking up money for extended periods of time, this in tandem with interest rates is meant to flood the market with attractive "free" money as part of a larger QE plan.

So in essence they are pushing the banks harder to loan money out and have established in the past the banks do not carry the burden of vetting their customers as they will get bailed out. So this money trickles down to Tom Dick and Sally where they use it to buy shit they don't need at 0 percent interest for a year increasing economic velocity and kicking the can another year down the line.

This works great too and avoids all the complications of hyperinflation, the only problem is they are under 2% now , there is only max another decade of this they can keep doing until they are literally paying the banks money to take money.
That is a social experiment we have yet to fully vet, but who knows it might work ....

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Yield curve inverted because 3rd world countries with negative bond yields like Germany are buying up US treasuries. As the 10yr gets bought, it's yield goes down.

so what do you suggest the average joe does with whatever money he has or can borrow?

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