As the monetary madness continues around the globe continues, what is happening is stunning.

Here is a portion of what Peter Boockvar wrote as the world awaits the next round of monetary madness:  Coincident with the spike in Treasury yields, bankrate(dot)com said the average 30 yr mortgage rate rose another 11 bps yesterday to 3.88%, up 41 bps over the past week. It’s the highest since early January and here is a chart giving the visual of the rapidity of the move…

To find out which company is
 set to become one of the
highest grade producing gold mines on the planet


I look forward to seeing mortgage applications tomorrow to see the initial response. To quantify, at last Monday’s 30 yr rate of 3.47%, a $300k mortgage would have a monthly payment of $1,342.12. At the 3.88% rate, the monthly payment would increase by about $70 to $1,411.57, a 5.2% increase.


The cost of capital is of course going up across the board and while I’m optimistic about growth initiatives to come, we’ve got to get past the move higher in rates because business activity and asset price gains have been built on the foundation of low rates over the past 7 years (as in the prior expansion). The US and the world also have an extraordinary amount of debt that has accumulated which has created the dangerous tinder for this rise in interest rates.

King World News note:  Mortgage rates based on the 10-Year Treasury have been headed dramatically higher as bonds plunge (see crashing chart below).

10-Year Treasuries Continue To Plunge As Interest Rates Rise


King World News note:  To illustrate how dramatically this has impacted mortgage rates, Wells Fargo’s posted rates for a 30-year conforming loan have risen in the past couple of weeks from 3.5% to 4.25%!  That’s 3/4 of a point higher in just a couple of weeks.  This will not bode well for the real estate market if the trend in higher interest rates continues.

***KWN has just released one of legendary Art Cashin’s greatest audio interviews ever discussing the gold market at length, including the recent takedown in gold, what to surprises to expect in key markets as Trump becomes president, and what impact massive public works projects will have on the United States, inflation, gold, bonds, and much more. and you can listen to this extraordinary interview by CLICKING HERE OR ON THE IMAGE BELOW.


***KWN has now released the extraordinary KWN audio interview with whistleblower Andrew Maguire, where he discusses the gold and silver smash, at what price the large sovereign wholesale bids are located, and much more, and you can listen to it by CLICKING HERE OR ON THE IMAGE BELOW.



© 2015 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.  However, linking directly to the articles is permitted and encouraged.

King World News RSS Feed