"An increase in the TED spread is a sign that lenders believe the risk of default on interbank loans (also known as counterparty risk) is increasing. Interbank lenders, therefore, demand a higher rate of interest, or accept lower returns on safe investments such as T-bills. When the risk of bank defaults is considered to be decreasing, the TED spread decreases."
"It isn’t the first time an indicator of financial and economic stress has stopped being useful."
"The Baltic Dry index, which measures shipping costs for dry bulk commodities, was once used as a bellwether of conditions in trade and the world economy and successfully warned of impending crisis months before Lehman Brothers collapsed in 2008."
"More recently, it has surged and dipped so much that it no longer seems to be signaling macroeconomic events. The index fell to its lowest ever level early this year before surging again, with no noticeable boom or bust in the global economy."