Housing reality: neither bubble nor bottom

Mortgage market commentary

Mortgage rates have risen again, sharply, beginning to push 6.5 percent for low-fee, 30-year loans, and big-media “news” won’t discover the jump until late next week because of lags in national surveys. It’s real, though, right now.

The definitive 10-year T-note has blown up to 4.88 percent from 4.45 percent only six weeks ago, the damage caused by a colossal bond-market error in economic forecasting. It was just certain last summer and fall that a slowing housing market would tip over the economy, and the Fed would begin to cut its 5.25 percent overnight rate in 2007.