by Jesse Anderson, CFA
This is not the type of Twist Chubby Checkerwould enjoy. This twist is focused on interest rates and flattening the yield curve.
The economy is still in a fragile state. Everyone is looking for the answer to provide the necessary spark for improvement. The president created a jobs plan and the Federal Reserve announced Operation Twist today.
Ultimately, the goal of the program is to move long-term interest rates lower. With lower rates across the yield curve, borrowing funds should be more attractive. This should spark investment and a move to riskier assets.