| Current mortgage rates remain at historically low levels | | | | environment is very difficult because if the government |
| even though there is a good chance of inflation. During | | | | runs out of bullets to slow overall rates, we could see |
| inflationary periods, the 10 year treasury rate and | | | | a sling shot effect in rates. |
| overall interest rates tend to move higher; much higher. | | | | The government has been attempting to put a cap on |
| During the last inflationary period during the 1970s and | | | | the 10 year treasury rate for quite some time, but |
| early 1970s, the ten year moved all the way up to 15% | | | | eventually the market is going to set interest rates. |
| and average mortgage rates were around 17%. To | | | | When the government slows their involvement, there is |
| put that into perspective today, the 10 year is at 3.5% | | | | going to be a coil effect with the treasury market. We |
| and overall home loan rates are around 5.35%. | | | | are likely to see the treasury rate to move full |
| Another issue at hand is the fact that the Federal | | | | percentage points in a very short period of time. |
| Reserve Bank continues to buy up mortgage backed | | | | If you have been considering getting a refinance, it |
| securities. By doing this, Ben Bernanke must print more | | | | might be time to go ahead and do it because the 10 |
| money which is proves to be a strong argument that | | | | year is sitting at the support level of the 50 day |
| inflation will get out of control in the next few years. | | | | moving average and could move up very quickly |
| Making an interest rate prediction in this economic | | | | which could push mortgage rates above 6%. |