From Frank Holmes of Frank Talk:
At the same time, there are some early warning signs of potential economic turbulence on the horizon. I would highly urge investors to ensure a portion of their portfolio is in a historically reliable store of value – investment-grade municipal bonds, for instance, and gold bullion and gold mining stocks.
One of the indicators some economists have their eye on right now is what’s known as the flattening yield curve – or the difference between long-term and short-term Treasury yields. When the latter exceeds the former, the yield curve is said to invert, and in the past this has often preceded an economic slowdown.
Recently, the difference between the 10-year and two-year T-note dropped below 50 basis points for the first time since October 2007. And with interest rates expected to be hiked three or four times this year, the yield curve could very well flatten even