It’s already starting to show this year: U.S. financial stocks have trailed the S&P 500 as the yield curve has flattened. While banks’ lending margins have increased slightly from their 2015 lows, they remain below the average of the past 30 years, according to the Fed. A potential increase in the cost of credit is at the heart of what worries Janus Henderson Group’s Gross. “In a highly levered economy with a lot of debt, and that typifies the U.S., we don’t have to go flat, perhaps another 20 to 30 basis points of tightening would be enough in order to induce certainly a slowdown in the economy,” he said on Nov. 3.

https://www.bloomberg.com/news/articles/2017-11-13/the-u-s-yield-curve-is-flattening-and-here-s-why-it-matters