What does the Treasury yield curve's shape say about future rates, and how extreme were 1981 and 2008?
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The yield curve plots coupon yields, not spot rates
Define the yield curve as coupon-bond against maturity, distinguish it from the spot curve, and record the condition under which it proxies the STRIPS curve, with the autumn 2008 coupons.
Treasury yields through time, 1981 to 2026
Record the early-1980s peaks (one-year above 17%, long yields above 15%, mortgages at 18.63%) against the very low autumn 2008 yields and the moderate 2026 curve and mortgage rate.
Cheap credit as opportunity and as diagnosis
Write the credit-card venture-financing example and why it gives up no equity, and record the easy credit before 2008 as the diagnosis of the crisis.
What the curve's shape signals
Record that an upward slope signals expected rate rises, and describe the circa-2000 humped curve and the long-run decline and Fed policy shift it signalled.