The Curve

The most important chart in finance isn't a stock index. It's the shape of what the government pays to borrow money, from a month out to thirty years. When that shape turns upside down, the bond market (historically the level-headed one) is quietly betting on trouble. My read: it's stopped shouting recession, but it hasn't given the all-clear either, which is a more uncomfortable place to sit than either extreme.

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01 · THE SHAPE OF MONEY

The term structure

4.35%
10-year yield (Jun 2026)
+0.55
10Y − 2Y spread

Treasury yields by maturity

Today's curve against the deeply inverted shape of mid-2023.

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02 · THE SIGNAL

10-year minus 2-year

Boil the whole curve down to one number and you get the spread between the 10-year and the 2-year. Below the line is inverted — the recession tell that has fired before every modern US downturn.

31%
NY Fed recession probability

10Y − 2Y spread, 2022 – 2026

Below zero = inverted. One of the longest inversions on record, now re-steepened.

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03 · THE VERDICT

What the curve is saying now

Put the shape and the signal together and you get the bond market's current read.

AI ANALYSIS