This Recession Indicator Is Ringing Its Most Severe Alarm in 40 Years. Here's What It Could Mean for the Stock Market.
The S&P 500 (SNPINDEX: ^GSPC) had a remarkably good year in 2023. The benchmark index advanced 24% as a host of factors helped improve stock market sentiment, including a surprisingly resilient economy.
After that performance, investors might have forgotten than many pundits had forecast a recession starting last year. That never materialized, but the risk has not disappeared. In fact, a forecasting tool based on the Treasury yield curve -- which has a near-perfect track record in predicting recessions for more than 70 years -- currently shows its most severe reading since 1981.
Here's what investors should know.
Source Fool.com
