US 30YR ENCROACHES ON 3%

At some point investoors will begin to view treasuries as more favorable than say PG — as risk-free yields cross over the 3% threshold.

More importantly however is the effects jacked up rates will have on the new landed gentry in the housing market — as all of the Walmart cashiers sell their $400k homes and move out into homeless shelters and/or relocate to other Walmarts in Fly-over country in order to bask in their newly minted riches.

Meanwhile, working class folks in San Diego can obtain a 400 sq ft home for the very affordable rate of just $400k. Granted, they won’t be able to fit a bed in their home — but at least they’ll be close to the frigid pacific waters and be able to enjoy that wonderful California weather amidst FISH TACOS 365 days per annum.

The prices have doubled and the cost to borrow has doubled and yet housing is just fine — BOOMING even. This time is different from 2008 because back then all of the people who borrowed were poor. Nowadays, all of the HGTV flippers are rich, fat bellied landed lords who install cheaply outfitted kitchens and SUBWAY TILED bathrooms in order to extract MAXIMUM VALUE from their investments. We like shiny things and especially new things, so obviously the HGTV folks will make money forever.