Un-inverting the yield curve...

Readers will see in this chart that for the second time this August, this particular spread is close to actually un-inverting. Is that a positive? That's hard to say. This spread is considered a predictor of economic contraction, and it has been inverted for a long time. Un-inverting does not erase the fact that this spread had sent that signal.

Additionally, the spread between the yields for the US Three Month T-Bill and US Ten Year Note is considered a far more accurate predictor of economic contraction than is the above spread and that spread remains deeply inverted. Take a look at this...

This spread is far more inverted now than it was back in the spring. Odd? Not really. I mean, periodic economic statistics have been sending mixed messages due to a skittish economy and badly inaccurate government data for at least a year and a half.