John Canavan Facto Quotations

The story of the week has been the inverted yield curve. It's tough to read too much into the inversion. We may be more firmly inverted tomorrow after the psychological factor sets in. We can have an inverted curve and have it not lead to a recession. It depends on how much the curve becomes inverted and how long it remains there until we can talk about a recession.

The spread supply had been a factor weighing on the Treasury market and when the 10-year TIPS auction didn't go terribly well, that compounded the issue.

The June trade deficit was larger than expected which would suggest -- barring any other factors -- a small downward revision to second-quarter GDP growth.