Industry NewsMarkets & Economy

U.S. economic jam, failed fixes follow historical script

Commentary: Be patient, very patient, for better times ahead

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There is new, nonrecession data here, more elegant pretending in Europe -- now can-kicking at two-week intervals -- and fear has left markets. For now. September retail sales rose 1.1 percent over August, and the small-business National Federal of Independent Business survey also found conditions in September slightly improved. In direct result, 10-year Treasury notes are trading up from 1.7 percent just two weeks ago to 2.25 percent, a two-month high. Mortgage rates have risen accordingly, pressing to 4.375 percent. Some self-correction is in play as mortgage refi demand is now shut off altogether, but the Treasury is a continuous seller of paper that the Fed's Operation Twist is unable to offset. This last week the Treasury auctioned $66 billion in long-term notes and bonds, and everyone who bought is today underwater. Until and unless markets get more negative news, there is zero chance of rate improvement. Pauses in the flow of news, and hence in markets, are routine....