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All roads lead to low rates

Commentary: How do we measure 'recovery'?

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Today is a strange day in a strange time. The Fed has begun gradually to withdraw support for the mortgage market, but mortgage rates are improving (back toward 5 percent) versus the 10-year Treasury. The unemployment rate spiked to 10.2 percent, but "nonfarm payrolls" in October, net of prior-months' revisions, contracted far less than expected: only by 97,000 jobs. The recovery vs. no-recovery debaters are still at it, but the dominant and growing group is uncertain. Not just about growth vs. not, but unsure about economic structure going forward, and distrusting more and more of the old models and indicators. Best evidence: the bad case of whiplash in stocks, with volatility rising again. As always, one piece at a time: rates first, then jobs, then measure the economy. The 10-year T-note has held 3.5 percent (again), despite massive new Treasury borrowing coming next week -- $40 billion in 3-year T-notes, $25 billion in 10-year T-notes, and $16 billion in 3...