"The Lock-In Effect of Rising Mortgage Rates"
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Today, in the Calculated Risk Real Estate Newsletter: "The Lock-In Effect
of Rising Mortgage Rates"
A brief excerpt:
Here is new working paper from Feder...
6 hours ago
2 comments:
Thank god for the Jan. 2006 and Jan 2007 rate cuts that reversed the trends!
Hahaha!
I can easily explain the trend reversals.
In 2006, a relatively large hedge fund tracking the flapping of seven butterfly wings in Argentina placed its bets on the world economy while another hedge fund was tracking three flapping butterfly wings in North Korea. The combination was brutal to the housing market.
One year later, the standing waves created from the flapping of these ten butterfly wings pushed one butterfly located in Central America 1.3 inches southward towards South America, which had a severe impact on the price of goods and services within North America due to its proximity.
That's how leveraged we are! :)
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