I'm Nicole Lapin, the only financial expert you don't need a dictionary to understand.

It's time for some money rehab.

Alright, money rehabbers, let's talk about macroeconomics.

Who's excited?

Today we're going to be talking all about the inverted yield curve.

I know that sounds like a whole mess of jargon, and it kind of is, but I promise I wouldn't

throw jargon at you if it wasn't super important.

This is super important because so many pros argue that an inverted yield curve is one

of the best and only signs of an impending recession.

This is valuable because the way we diagnose recessions is reactive, not proactive.

For example, the classic definition is that a recession is any period where the inflation

adjusted gross domestic product or GDP declines for two quarters.

And since you don't get GDP numbers until after those two quarters, it can be more than

six months until you know your interrecession.

So not that helpful.

Economists use a more complex definition describing a recession as a period of economic contraction.

The GDP shrinks, but so do incomes, retail sales, and manufacturing.

The only thing that grows, unfortunately, is unemployment.

Well, you can make that judgment call a little quicker than waiting to quarters for the

official GDP numbers.

It's still not instant.

So the takeaway from all of this is that there isn't some red warning light that flashes

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