When the Yield Curve Inverts, Does the Market Hurt?

I don't know if anyone noticed last week but the 3 month Treasury Bill yield was higher than the 10 year Treasury Note yield for five days beginning Friday March 23rd. This is known as a yield curve inversion. Historically, when the yield curve inverts steeply, or for several months, a recession and bear stock market usually follow within a year. This is because the high short-term interest rate indicates overly tight monetary policy while the low long-term rate suggests the bond market believes the economy will weaken.

A short-term inversion occurred in 1998 when the economy was much weaker but the U.S. was recession free for another three years. The inversions that occurred prior to the 1990 and 2008 recessions lasted multiple months and were deeper than the recent inversion.

So far, most of the Wall Street talking heads are dismissing the inversion but that's whan many did in 2007. They may be right because the labor market remains extremely strong although there are some recent signs of a cool down in manufacturing. Any thoughts?

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When the Yield Curve Inverts, Does the Market Hurt?