Timing Solution Digest, 22 SNP and T Bonds yield correlation, what is next

I would like to explain what this result means in practice. Formal cyclical analysis shows that we are moving to in red, positive zone deflationary environment period when stocks and TBonds yield move together or do not correlate. IMHO stocks will not drop just because of TBond yields getting higher; if they drop, it may occur for be some other reason. Though I accept an argument like this: it is easy to discuss deflationary scenario when FED rate is 02; but what about its going to 5+ . Look at the chart below. The last deflationary period covers 19401964 interval. Within that period the rate varied in 24 range, in 1964 FED rate overpassed 4+ zone and inflationary period begun. This is the chart: XXXX Inflationary period started in 1964 when T yield reached 4. 2. So, I agree, high yield may work as a trigger that switches the environment. And then we get a negative correlation. Sorry, I would prefer to see the picture more definitive. But this is wha