What Happened The Last 2 Times Mortgage Rates Spiked Like This?

Tyler Durden's picture

Perhaps - as we are always reminded - it will be different this time but following this morning's surge in Consumer Confidence, we got to thinking, just why is everyone so confident? The facts are, as Citi's FX Technicals group notes, the last times we saw mortgage rates surge like they just have, that marked the peak in consumer confidence and the market followed shortly after. It seems that the Fed, by engineering ever lower rates, can lift confidence; but as is clear from this chart (and as we noted previously) there is a limit to this effect (ZIRP) and each cycle has diminishing returns.

 

 

Chart adapted from Citi FX Technicals

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slaughterer's picture

AHHH!  Let me get my KY Gel out at least to lube my bear ass before Kev' straps on the ramp dildo!  Another Tuesday bull gang bang.  

nomorebuyins's picture

3:45 thing happening again.

Unprepared's picture

As Y! Finance reported yesterday, consumers may be broke and savings-less. But the great news is that they are as confident as ever. If that's not proof all is well. REcovery under way. BTFD.

syntaxterror's picture

Everyone gets a bailout. That's the lesson.

slaughterer's picture

What? AMZN $1000? DUST $500?  GOLD $.001?  SLV $.00001?  Krugman is Fed chairman?  WTF??

Yen Cross's picture

    Tyler did a piece not a month ago Re; large Cos. selling their R/E holdings. (taking profit) One thing many people don't understand is that there is still a massive amount of inventory being held back to inflate prices.

    When this thing blows again, (and it will) the banks are going to have to deal with the junk on their books from 2007-2009 and all the new garbage. No bailouts this time fellas, the Fed is tapped.

nomorebuyins's picture

They saved China and moved the S&P futures from below 1560 last night. I would be confident too, if I thought less and BTFD more.

syntaxterror's picture

Just pass a law promising 0.0% rates 4-eva and, voila, infinite confidence!