Fed Fireball! Mortgage Rates Climb To Highest Level Since 2009 As Fed Attacks Inflation And Markets Get Crushed (S&P 500 Index Down 7% In April, Bitcoin Down 11%)

by confoundedinterest17

Its Saturday and I’m dreading markets opening on Monday. However right here is the place we sit at this time.

The 30-year mortgage fee has soared to five.29%, the best degree since 2009 in the beginning of Obama’s Presidency. Since 2009, we have now seen the buying energy of the US Greenback decline additional (orange line) whereas inflation (blue line) has soared. M1 (yellow) and M2 (inexperienced) has been rising because the monetary disaster, however actually took-off with the Covid outbreak in 2020 and The Fed’s huge overreaction coupled with Federal authorities stimulus.

For the reason that creation of The Federal Reserve System beneath President Woodrow Wilson, the buying energy of the US Greenback has collapsed a lot that $10 in 1913 in value 34.8 cents at this time. However discover that since 1949, the CPI YoY has hardly ever been damaging which means that costs are just about solely going up.

As an alternative of April showers deliver Might flowers, it’s April anticipated Fed fee hikes (now 10.408 fee hikes by February 2023) bringing declining belongings costs. In April up to now, the S&P 500 index is DOWN 7%, the 10-year Treasury Word value is DOWN 5%, Bitcoin is DOWN 11%, the three.5 coupon company MBS value is down 3.2%.

We’re seeing elevated volatility in each the fairness and bond markets.

Effectively, Powell and The Fed are hurling fireballs at mortgage charges and asset costs in April.