AgentIndustry News

Definite signs of a false recovery

Commentary: It's time to curb federal spending

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Interest rates stabilized at the conclusion of $65 billion in new Treasury borrowing this week, mostly by sales of long-term bonds. "Stability" is a relative term: All long-term rates have risen roughly 1 percent in just six weeks, and a further run-up will undercut any economic recovery. The question is whether current prospects for recovery justify this rate-surge, or is this surge already unsustainable? If the latter, what's the chance for a reversal, especially in mortgages? In today's epic divergence in economic outlook, you found what you wanted in the new data. May retail sales rose 0.5 percent -- some say presaging positive gross domestic product, others weak-as-ever, flat after extracting a spike in gasoline prices. New claims for unemployment insurance fell close to 600,000 last week, down from the 668,000 peak in early April but almost triple anything resembling job growth. The damage to long-term rates was entirely pushed by Treasurys -- for whatever re...