Inverted Yield Curve

[Cecilia]

I went to this SC (sorry, cannot remember when, maybe last month, I think so  ) & they talked about Inverted Yield Curve, I went home halfway. I think they said something that it's good to monitor the bond market, something like, if the bond is down, share is up, & vice versa.

I searched online about this Inverted Yield Curve, it talks on US treasury & recession, that a recession will follow 12-18 months later when the Inverted Yield Curve is formed (sort of like that, I think so ). And out of 9 recessions, it only missed 2.

Anyone know how this is going to affect our market, & what is that so?

[Maxforce]

Something I posted before in another forum. Generally only.

Oil goes up.
Prices of goods goes up.
Inflation goes up.
COnsumer spending goes down.
Economic slowdown.

Oil goes up.
Prices of raw materials goes up.
Cost of goods sold goes up.
Profit margin goes down.
Earnings report goes down.

All points to shares goes down.

But bonds will go up. Why?
Inflation goes up.
FD rates remain. Like now it is negative real rates - meaning inflation more than FD.
Inflation currently 4.5%, FD 3.8% so at end of year, your investment in FD has less purchasing power.
But this would make bond market VERY attractive.

However, Bank Negara will raise Interest Rate.
So FD will go up.
Bond less attractive
So bond goes down.

As for stocks, Interest rates up.
Borrowing costs goes up.
So Net profit goes down.
Earnings report goes down
Share Price goes down.

So thats the colleration between Interest Rate, Inflation and Stocks, Bonds.
(In my simple language form without any jargons or sounding professional)