[quote=DWCAP]TG, what can the gov do to keep down interest rates? They can bail out the GSE’s, but how do they force rates down in a high (relatively) inflation environment?

Also, we are nearing the end of July, the elections will start gearing up soon, officially, and Washington will empty so people can raise money or votes. How are they gonna run things between early October and January? [/quote]

Huh? What we’re seeing here is rising long bond rates perfectly correlated to when Hank (Skeletor) Paulson began demanding a blank check to backstop the GSEs. Bailing them out is going to help US Gov’t borrowing costs skyrocket. Get ready for more as he dips into the $800 billion line if this bill passes the Senate!