Weak labor market to keep mortgage rates in the fives

Fannie Mae scandal won't affect borrowing costs

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Long-term rates are off the floor: the 10-year T-note is rising toward 4.2 percent, which is taking low-fee mortgages north of 5.75 percent.

Neither perceptions of economic health nor fear or the Fed are as much to blame as awareness that rates were on the floor, and could not proceed down the basement stairs without a new, bad-news trend. If a market can’t get better, there is only one trading strategy left: sell.