Chart of the Week: 10 Year Yield (Post-Crash) vs Japan

Monday, June 06, 2005 | 10:59 AM

Even in this recovery with near zero Fed Funds, job growth was weak and wage growth never materialized.

What will the next recovery look like? 


Post Bubble Yields: U.S. 10 Year(Post-2000) vs Japan (Post-1989)

click for huge chart

10_year_versus_japan


Rate Cycle:  Lower Lows, Lower Highs

Rate_cycle_lower_highs

Charts courtesy of JDC

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The stimulation for the next recovery might be even more limited, given the extremes in current leverage and rates. If we follow the Japanese model, stocks could go down for several years, bonds go up even further, as the dollar rallies, materials and energy stocks do poorly. In this scenario, Gold diverges from the dollar and rallies strongly.

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Quote of the Day

The greatest booms unfold when capital concentrates in one sector. When that capital shifts, you also find the result of the greatest financial panics in history.

--Martin A. Armstrong

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Monday, June 06, 2005 | 10:59 AM | Permalink | Comments (4) | TrackBack (0)
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Comments

If bonds make new highs from here, won't that continue the housing boom?

And if the housing boom continues, won't it provide more fuel for the stock market?

Posted by: Chris | Jun 6, 2005 3:02:13 PM

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