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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (2862)	11/3/2001 10:10:34 AM
From: Zeev Hed	Read Replies (1) \| Respond to of 99280

Others on the thread know that market in detail. Zeev

To: mishedlo who wrote (2862)	11/3/2001 11:10:14 AM
From: Crimson Ghost	Read Replies (3) \| Respond to of 99280

Mortgage rates generally key off the 10-year bond, not the 30-year. 10 year yields fell as slow as 4.1% last week before closing around 4.35%. If Zeev is right about a sharp equity drop soon, the 10s probably will back down to the 4.1% area again. But once the equity market begins a sustained advance I look for interest rates to commence a sharp rise all across the maturity spectrum. Loading up on long bonds at these levels makes no more sense then loading up on tech stocks when the NAZ was 5000. Would not be surprised to see the 10-year yield at 5.5% or more within 12 months.

To: mishedlo who wrote (2862)	11/3/2001 2:05:26 PM
From: captaintime	Respond to of 99280

Mortgage rates have been a major bullet used to liquify the consumer by AG. The recent wave of refis have targeted home sales during the year 2000 when mortgage rates were as high as 8.5%. The bulk of refinances at an interest rate level of 7.125% on average were accomplished prior to year 2000. In the business we have seen some cash out refinancing or consolidation of 1st and 2nd's due to real property increases in value during the last few years at rates of 6.5-7% recently. For a major refinance wave of the vast bulk of sitting home loans in the 7.125% range we need long term 30 year mortgage rates of 6% or lower and stability in property values; perhaps the Treasury's recent shot across the bow (eliminating the 30 year bond) is the first attempt to get us there.