ilmscore | The Bond Market Just Broke The Fed

The Bond Market Just Broke The Fed

Predictions from this Video

Total: 21
Correct: 14
Incorrect: 5
Pending: 2
Unrated: 0
Prediction
Topic
Status
US lost 13,000 jobs in June, marking the first negative job report since 2021.
"We're now showing we actually lost 13,000 jobs in June. That is the first negative jobs report since 2021."
US Job Market
Incorrect
The Federal Reserve may cut interest rates by 0.5% to stimulate the economy.
"So to save the economy, the Federal Reserve might come in and cut interest rates by as much as half a percent."
Federal Reserve Interest Rates
Incorrect
The bond market indicates the US might already be in a recession.
"The bond market is telling us we actually might be in a recession already."
Bond Market
Correct
UK 30-year bond yields reached their highest level since 1998.
"In the UK, for example, the yield on the 30-year bond, called the guilt just went up to its highest level since 1998."
UK Bond Yields
Correct
Japan's 30-year government bond yield hit a record high and is moving in correlation with the price of gold.
"In Japan, their 30-year government bond yield hit a record high, and it's been moving almost at the same rate as the price of gold, which is something that should never normally happen."
Japan Bond Yields
Incorrect
Long-term US bond yields are increasing despite the Fed signaling potential rate cuts.
"Even though the Fed is telling us they are preparing to lower interest rates, the opposite is happening. The yield on long-term bonds is going up."
US Treasury Bond Yields
Correct
When the bond market deviates from central bank policy, it signals a problem in the financial system.
"History shows us that when bonds stop listening to the central banks, it's usually one of the first warning signs that something's wrong with the financial system."
Recession Signal
Pending
US 30-year Treasury bond yields are approaching 5%.
"Here in the US, the 30-year Treasury bond is wanting to touch 5% interest if it hasn't already."
US 30-Year Treasury Bond
Incorrect
The US yield curve inverted in 2022 and remained inverted for approximately two years, the longest on record.
"In the year 2022, our curve inverted and it went on to become the longest inversion of all time for about 2 years straight."
US Yield Curve Inversion
Correct
A steepening of the 10-year and 2-year Treasury bond yields often precedes a recession.
"When the 10 and 2-year Treasury bonds gets steeper, like right now, it almost always happens right before a recession."
Recession Prediction
Correct
Following a yield curve inversion and subsequent steepening, a recession typically occurs.
"But when we go back above the line, eventually a recession follows somewhere at the end of it."
Recession Prediction
Incorrect
UK 30-year government bond yields are at their highest point since 1998.
"Over in the UK, for example, the yield on their 30-year government bond is the highest level since 1998."
UK Bond Yields
Correct
Japan's 30-year bond yield exceeded 3.2%, reaching a new record high.
"This year, Japan's 30-year bond yield broke above 3.2%, which is a record high."
Japan Bond Yields
Correct
Germany's 30-year bond yields are at a 14-year high.
"In Germany, the 30-year bond yield is also at its highest level in about 14 years."
Germany Bond Yields
Correct
France's 30-year bond yields are at their highest level since 2009.
"In France, their 30-year bond is at the highest level since 2009."
France Bond Yields
Correct
Sustained high borrowing costs will lead to stalled or declining home prices.
"So, if borrowing costs stay this high for this long, home prices will either have to stall or come down."
Housing Market
Correct
Home prices are predicted to either stagnate, grow by 1-2%, or decline due to increased inventory from rate-locked owners selling.
"At best home prices will stay flat or they'll grow at 1 to 2%. And at worst, we might see deflation as rate locked owners list their homes, which could flood the market with more inventory, which puts downward pressure on home prices."
Housing Market
Correct
The simultaneous rise in gold prices and real yields is an unusual signal indicating a loss of investor confidence in the financial system.
"Normally, when real yields or rates go up, gold goes down. But this year, both are going up together, which is a really rare signal that investors are losing trust in the whole system."
Gold Market
Correct
Bitcoin's long-term price is expected to rise, mirroring gold's trend, as it is an asset outside government balance sheets and unaffected by government borrowing cycles.
"Over the long term though, Bitcoin follows gold. And if governments are forced into endless borrowing cycles with higher deficits, which is what they're doing, Bitcoin is one of the few assets that is not tied to that government balance sheet because it's outside that system. So, the price in the long term should go up."
Bitcoin
Pending
Increased social unrest, geopolitical issues, division, and a widening wealth gap are predicted to occur irrespective of recession status.
"Regardless if we're in a recession or not, I think there's going to be more social unrest, more geopolitical issues, more division, the wealth gap will get bigger and bigger."
Social and Geopolitical Trends
Correct
A future is envisioned where capital growth outpaces labor income, and traditional work becomes secondary due to advancements in robotics and automation.
"I think there is this weird future where money will make more money faster than labor ever will. Especially with everything that we know that's coming with robotics and automation, working might be a secondary thing."
Future of Work and Investment
Correct