Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: mishedlo who wrote (12115)	9/22/2004 8:06:57 PM
From: russwinter	Read Replies (1) of 116555

Good thoughtful analysis, think you've hit many of the variables towards analyzing the end of the credit and housing bubble. A couple points to consider. The 9-15 and 9-22 rates at 5.68 and 5.66 respectively were when the 10 year was 25-35 bps higher than now. The question is: will a 5.35- 5.40% rate spike refis above 3000, or even towards 3500 again? I'll bet we don't quite see the 3500 level, but maybe towards 3000 if it's sustained awhile? Historically 3000 or even 2500 is robust, enough to fuel plenty of new equity extraction and borrowing. We will see. I still think a 6.0% 30 year mortgage is what we need to kill the goose. <How how does today’s FNM news affect this picture?> This could be a extremely critical question, the key to all. But more importantly than FNM's stock price, what did the mortgage backed market do today? I haven't been able to locate the answer. Buried in here perhaps, I'll look? investinginbonds.com If it keeps rallying in tandem with the treasuries, then we have the answer to your question. If not?

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