Part 8/9:
Among all the indicators discussed, perhaps the most reliable is the 10-2 bond spread—a metric that has accurately predicted every recession in the U.S. since 1976. This indicator measures the yield difference between 10-year and 2-year U.S. Treasury bonds. When the yield on the 10-year bond falls below that of the 2-year bond, a negative spread occurs, historically signaling a forthcoming recession.
Presently, the 10-2 spread is negative, as seen during previous economic hardships, suggesting that investor behavior may be reflecting an expectation of an economic slowdown soon.