Is the Yield Curve Bearish for Stocks?

The yield curve is commonly measured as the spread between the 10-year US Treasury bond yield and the federal funds rate. This spread has narrowed significantly since the start of this year, raising fears of an imminent recession and bear market in stocks. That's because in the past, the yield curve spread has flattened (i.e., narrowed) and then inverted (i.e., the bond yield was below the federal funds rate) immediately preceding the past seven recessions.