One of the most accurate recession predictors is only half right. Here's what the yield curve is actually saying, according to a market veteran

• One of the most accurate recession predictors is only half right, market veteran Ed Yardeni told Insider.
• The yield curve has been inverted for more than a year, but it doesn't mean a recession is ahead.
• "But we certainly had a recession in housing. We certainly had a recession in retailing," he explained.

While the yield curve is inverted, that doesn't mean the closely watched recession indicator is predicting a downturn ahead, according to market veteran Ed Yardeni.

For years, he has been saying the inverted yield curve is an indicator for a process, not a recession. In 2019, he coauthored a paper titled "The Yield Curve: What Is It Really Predicting?" that lays out his argument.