“Don’t get me wrong, Your point may be correct. Just to be sure though, you are saying that you believe the 10 year will hit levels that it basically has never hit before. Which would be awesome for housing. A 10 year at 1.5% puts a fixed rate conforming loan at 3%… Not bad at all. At the same time our debt will continue to be financed by foreign entities who will buy these instruments at that low of a yield.”
I’m saying this:
I believe that the 10 year may stay at these levels or possibly go lower for a while. At the same time USD may start appreciating and it will make US treasuries even more attractive for private investors both here and abroad.
Sooner or later stock market will turn around, I can’t predict what happens next.
Also 10 year at 1.5% won’t be any good for housing if there are some drastic changes in mortgage markets e.g. Fannie Mae goes bankrupt, but if that happens, housing will be the least of our problems.
