Mortgage Rates at Highest in Nearly 4 Yrs.

dont understand rate increase in 1971 when nixon took us off gold standard..we started printing like crazy...are we running out of paper...or has china just got enough paper

Indeed, foreign banks are hitting a limit for low rate debt... With the 30 and 10 years merely reflecting lower auction demand.

As for the printing of money, long rates reflect excess money printing when they go up. Contrary to what many think the natural equilibrium of same risk debt is to have a near flat yield curve.

Enter The Fed, and you have a jerking back and forth of short term rates and money supply. Keep in mind, short term rates from the Fed are only one facet -- affecting only short term rates mostly. But when overall money supply (e.g. M2, M3, etc.) cranks up --which it has continued to do in the face of the Fed Fund's rates rises -- folks start discounting future dollars because of inflation risk with a demand for higher rates.

To that last point, many in the mainstream are attributing inflation concerns to a heated economy – e.g. too much demand thanks to growth.

Hardly!! We are slipping into a recession and have barely been above water (despite the fudged GDP / CPI numbers) for the last five years – if even above water.