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We had been warned over a month ago. Yet now after 30 or so days, when the yield curve inverted for the first time after more than ten years; life goes on, and in the corridors of power in Washington with no qualms nor fears of a looming recession.

Historically, an inverted yield curve is a financial phenomenon that has signaled recession. Typically, long-term bonds offer higher returns than short-term bonds. When yields on short-term bonds exceed those on longer maturity debt, that’s when yields invert. This is the widely watched indicator since the Great Depression to signal that unwelcome economic headwinds are strengthening and things are going to get worse for the economy.

Yet amidst the flashing red that the US economy might be moving to the precipice of recession, the White House and the politicians that surround it remain in denial. The reason: It’s the election season.

With next year’s election in America, everyone’s eyes will be on the economy - and the Trump administration will have to use every trick from the “How to Stay in Power” handbook to keep the economy growing, albeit if multiple signs flash overheating. This they have done for the last 4 years, brushing aside the writings on the wall. Nonetheless, we have seen this before when a presidential directive contradicts fiscal policy. Look at the Fed for example: Trump has been bad mouthing Fed Chairman Powell constantly through numerous insulting tweets and invectives, with the barely concealed instruction that the Fed must yield to political influence or else face unspecified future consequences.

As we have maintained over the last two years, the markets are already on shaky ground. So the news on that yield inversion does not come as a surprise to us – but rather a validation of our observations and sentiment. Unfortunately, those who hold higher office are not happy about this – for obvious reasons in that they have an election to win next year.

With so many questionable foreign policy indicatives and economic/political challenges that this administration have brought upon itself, an indication that things are going seriously awry is the last thing that Trump wants to hear. And there is still that unresolved trade war with China that is beginning to get very ugly with the potential to create an economic disaster for the US more pronounced than ever realized.

The course of action for the incumbent administration is to do all in their power to head off an economic slowdown in the run-up to the 2020 November vote; but to create an illusion and deny the economic reality to the eyes of the electorate.

This is not the first time that Trump has brushed aside stubborn facts and leading indicators, as he manically swings all of these situations to his favor. Like the alarming truths on global warming, immigration, economic trade, and so on and so forth - this has always been Trump’s refusal to recognize reality but only to create or invent ‘imaginary’ conditions that make him the ‘brightest’ and most intelligent star for the media, news outlets and national television. This is not Trump in Washington that serves with practical serious solutions for the common American good. This is Trump on television that is always shinning bright in the limelight - and in a ‘make belief’ world of his own.

Welcome to The Wonderful Incredible Fantastic World of Trump.