Why the US is heading for recession

Central bankers in the US - and here in the UK for that matter - are tying themselves in knots to explain why long-term interest rates are so low. But the core reason is quite simple, says economist Dr Kurt Richebacher in The Daily Reckoning - central bankers have printed too much money. And their excesses have left the US on the brink of a recession...

The biggest puzzle of the past two years lies in the behaviour of intermediate and long-term US interest rates. They have stayed at their unusual lows in the face of general economic euphoria and a 300-basis-point uplift by the Federal Reserve.

As a consequence, the yield curve has flattened much earlier than expected. While the consensus does not seem to worry, it is a fact that in the past this has always signalled an impending recession. Why not this time?

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