Treasury Market Had a Cow, Mortgage Rates Jumped, Wall Street Crybabies Clamored for Help, But the Fed Smiled Satisfied Upon its Creation | Wolf Street

The 30-year mortgage rate normally tracks the 10-year yield fairly closely. But in 2020, they disconnected. When the 10-year yield started rising in August, the mortgage market just ignored it, and mortgage rates continued dropping from record low to record low until early January, whipping the housing market into super froth.

In this incredibly frothy and overpriced bubble housing market, higher mortgage rates are eventually going to cause some second thoughts.

And that too appears to be smiled upon approvingly by the Fed. They’re not blind. They see what is going on in the housing market – what risks are piling up with this type of house price inflation. They just cannot say it out loud. But they can let long-term yields rise.

Treasury Market Had a Cow, Mortgage Rates Jumped, Wall Street Crybabies Clamored for Help, But the Fed Smiled Satisfied Upon its Creation | Wolf Street

No worries… Just another huge BUBBLE, among dozens of other huge bubbles.. Which will be the first to go POP?