Published Thu, 20 Sep 2018 04:28:18 -0400 on Seeking Alpha
Nightmare scenario for the markets? They just shrugged. But homebuyers haven't done the math yet.
There's an interesting thing that just happened, which shows that the US Treasury 10-year yield is ready for the next leg up, and that the yield curve might not invert just yet: the 10-year yield climbed over the 3% hurdle again, and there was none of the financial-media excitement about it as there was when that happened last time. It just dabbled with 3% on Monday, climbed over 3% yesterday, and closed at 3.08% today, and it was met with shrugs. In other words, this move is now accepted.
Note how the 10-year yield rose in two big surges since the historic low in June 2016, interspersed by some backtracking. This market might be setting up for the next surge:
And it's impacting mortgage rates - which move roughly in parallel with the 10-year Treasury yield. The Mortgage Bankers Association (MBA) reported this morning that the average interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) and a 20% down-payment rose to 4.88% for the week ending September 14, 2018, the highest since April 2011.
And this doesn't even include the 9-basis-point uptick of the 10-year Treasury yield since the end of the reporting week on September 14, from 2.99% to 3.08% (chart via Investing.com; red marks added):
While 5% may sound high for the average 30-year fixed rate mortgage, given the inflated home prices that must... Read more
|Stock name||Last trade||P/E||Earnings/Share||Dividend/Share||Dividend yield|
|NUVEEN REAL ESTATE INCOME FUND||10.65||0.0||0.00||0.00||7.18|
|COHEN & STEERS REIT||21.50||0.0||0.00||0.00||6.90|
|RMR REAL ESTATE INCOME FUND||19.20||0.0||0.00||0.00||6.89|
|COHEN & STEERS QUALITY INCOME REALTY FUND||14.20||0.0||0.00||0.00||6.80|
|COHEN & STEERS TOTAL RETURN REALTY FUND||14.36||0.0||0.00||0.00||6.68|
|VANGUARD EXTENDED DURATION TREASURY ETF||127.54||0.0||0.00||0.00||2.58|
|SPDR DOW JONES INDUSTRIAL AVERAGE ETF TRUST||265.56||0.0||0.00||4.99||1.91|
|SPDR S&P 500 ETF||293.06||0.0||0.00||3.99||1.38|
|PROSHARES ULTRAPRO SHORT S&P 500||28.33||0.0||0.00||0.00||1.16|
|PROSHARES ULTRASHORT S&P 500||31.13||0.0||0.00||0.00||1.15|
|POWERSHARES QQQ TRUST SERIES 1||187.11||0.0||0.00||1.08||0.79|
|ISHARES COHEN & STEERS REALTY MAJORS INDEX FUND||116.42||0.0||0.00||0.00||0.00|
|SPDR BARCLAYS CAPITAL 1-3 MONTH T-BILL ETF|
Older articles featuring Nuveen Real Estate Income Fund (JRS):Resolving The Contradictory Signal Between The Yield Curve And Housing: Watch Corporate Profits
Infrastructure REITs: A Match Made In Low Yield Environment Heaven
Global X SuperDividend REIT ETF: A Solution In Search Of A Problem?
Yield Hunter CEF Report March 2019: Distribution Cuts Pick Up, But So Do Increases
Barron's Says To Buy MLPs In 2019, Yet Its Best Yield Plays Favor Vodafone
Will Rates/Yields Peak Soon?
100 High-Yielders Down Big: These 5 Are Worth Considering
Housing History And Why The Yield Curve Got So Flat
Want To Be A High Yield Landlord? Hop Aboard The REIT Income Train
The Chemist's CEF Report - July 2018: Treasury Yield Spread Continues To Narrow