I am using the Treasury yield curve data visualization web page that the Treasury Department provides, and I have found something rather interesting. You can often get an idea what the future holds by looking at Treasury yield curves (yield plotted against maturity). I decided to see if there was a date in the past when the yield curve had the same shape as today--and I found an interesting match:
The yields are a good solid point below where they were in 2003, but it does seem like we could be getting ready for a pretty remarkable boom.
UPDATE: A reader asked a question in the comment. A little clarification of my thought processes:
A steep yield curve can mean either inflation is coming, or an economic recovery that is going to drive up interest rates. It is not that rising interest rates cause the boom, but that a boom will cause rising interest rates. That has been the historical significance of a yield curve like that. Compare to the yield curves for a couple of other dates when the economy was in deep trouble:
For a bond investor, the current yield curve says to not buy long-term bonds right now. Buy stocks instead, sell them when almost everyone is talking about how there is nowhere for the stock market to go but up, and buy long-term bonds with the proceeds.