Following what must have seemed like a dream year for investors -- 2021 featured a peak correction in the benchmark S&P 500 (SNPINDEX: ^GSPC) of just 5% -- 2022 has been a nightmare. All three major U.S. stock indexes have plummeted into a bear market, with the S&P 500 producing its worst first-half return in more than 50 years.

Worse yet, the new year might give way to a recession. While no indicator is foolproof, the interest rate yield curve is exhibiting its biggest inversion in four decades (i.e., short-term-maturing Treasury bond yields are considerably higher than long-term-maturing bonds). Historically, this has been a telltale warning that a recession is in the offing.

Image source: Getty Images.

Continue reading

Source Fool.com