Don't Panic Yet. Stocks Rise On Average 15% After Inversion!

https://www.youtube.com/watch?v=cJQTw1waBlg&t=348s



Don't panic after the yield curve inverts.

1. Stocks generally still rise 15% on average about 18 months after the yield curve inverts.

2. On average stocks only peak 24 months after the first sign of inversion. This means we could see the bull rally last until March 2021! With 15% appreciation!

3. The main "yield curve" to take note is the 10 - 2 years, not the 10 - 3 months.

4. Generally we won't see a recession until 13 to 34 months after the inversion. So we won't see a recession until Apr 2020 earliest, or Jan 2022! That's a long long way off!

In summary, we will still see around 15% of capital appreciation, which is in line with my view that one bad year in 2018 will follow up with 2 good years. A recession is likely to happen around end 2020.

Just remember this is probably the final leg.

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