Junk Bonds Have Spoken: Time For A Correction in the Stock Market

The spread between “junk bonds” and US treasuries has always been a great indicator for financial markets: starting from now equities may have a hard time at going up

Here is the chart of the historical spread between junk grade bonds and the 10 year US treasury bond:

From now on, it can only go worse. That’s what history says (and history usually gives us better forecasts than most analysts).