Here's What The Treasury Market Is Really Saying

Nothing Positive Exists About Being In The Lurch

May 5th, 2025 - Volume 11 (2025) Missive 73 (Monday)

• Anywhere but in the lurch

• Professional business services productivity max

• No escaping the economic procession

As we pointed out in Friday’s missive, last week’s employment report is emblematic of a much bigger problem in the economy few, if any, care to, assuming they’re even able to really address. The economy is in much too volatile of a place for the data to do much of anything with regard to accuracy. While on the surface this might not seem like to all much of a problem for no time limit exists on the economy. But that’s a half-truth as decisions still need to be made, or decided to be not made, regardless of how long it takes for everything to get sorted out in the wash. The problem is, it is taking much, much longer for the economic truth of the matter to be discovered; leaving all in the lurch which is about as far from anywhere you’d like to be when it comes to understanding the economy and its needs. The unpleasant nature of the lurch, in fact, has been what the U.S. Treasury yield curves have been communicating about for some time, leaving the uncomfortable impression that the gap between what the economy is doing and what it should be doing is growing further by the moment.

The current breakdown in the yield curve correlation signals a deeper problem.

Flying blind might seem apropos when attempting to ascribe the current situation of unusable economic data and projecting the economy. However, that particular idiom suggests that it is simply a visual problem and that the quality of the data being produced is unchanged. That, though, is not the case as the reports themselves are victims of the volatile times themselves, specifically when it comes to the headline