How Bernanke’s Fed Triggered the Great Recession

Richard M. Salsman at Forbes:

Notably, the U.S. yield curve was inverted prior to all seven U.S. recessions in the past half-century and no recession occurred in that time without a prior inversion. That’s a perfect forecasting record. The Fed also inverted the yield curve prior to the 1929 stock-price crash and Great Depression in the 1930s.

Fantastic article that explains in simple terms the monetary policy that led to the 2008 recession. I had no idea how accurate the direction and shape of the yield curve is in predicting an economic recession. Given the empirical evidence, it’s a disgusting fact that the Fed shapes the yield curve at will.