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‘Mortgage starvation’ stunts recovery

Commentary: Latest reports stranger than fiction

Long-term rates jumped this week, and the 10-year T-note rose to 3.6 percent from 3.28 percent at last week's low, the principal push delivered by a 500-point surge in the Dow. Mid-summer is the "silly season," when a shortage of serious news elevates "Man Bites Dog" to the front page. This stock rally was short-covering, and bonds are on constant selling edge because of runaway deficits. New data could be read as green-shoot or L-shaped non-recovery, but none were trend-changers. Housing permits and starts rose a bit above forecast, to the high-500,000 annual range from high-400,000 in last winter's pit, but housing is going nowhere, loan applications flat. Total retail sales improved in June only because gasoline cost more. Some silly-season items this year are downright strange. Since 1971 Freddie Mac has surveyed mortgage rates early each week and reported on Thursdays. By 1980 mortgages began to move with bonds in real time, but not Freddie, which ...

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