Ten-year US Treasury bonds broke 3%, but you shouldn’t worry

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Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

The 10-year US Treasury government bond rate broke 3% this week for the first time since 2014. Don’t fret, though—it actually used to be way worse.

Published 5 hours ago  |  Photo by Reuters/Brendan McDermid
Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

The increase in yields is partly due to the Fed unwinding its multi-trillion-dollar balance sheet, plus an increase in borrowing to fund the deficit.

Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

US 10-year Treasury yield

Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

Most Americans will see the impact on personal borrowing—mortgages, credit-card interest payments, and auto loans—because treasury yields directly affect interest rates.

Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

Millennials may worry, especially the majority who are stressed about money and were never taught to handle debt. But any American over 55 probably remembers paying big bank bills each month.

Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

US 10-year treasury yield

Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

Back in 1981, interest rates were something to really worry about. The 10-year note peaked at 15.84% and the 30-year fixed rate hit a high of 18.63%—a level unthinkable today.

Traders work at Bloomberg terminals on the floor of the New York Stock Exchange, May 13, 2013. Bloomberg LP customers, including the U.S. Federal Reserve and the U.S. Treasury, are examining whether there could have been leaks of confidential information, even as the media company restricted its reporters' access to client data and created a position to oversee compliance in a bid to assuage privacy concerns. Bloomberg has more than 315,000 terminal subscribers globally, with each Bloomberg terminal costing more than $20,000 a year.

3%

Based on today’s median house price of $328,000, if rates were back up at 18%, the average monthly payment would be over $4,000. This compares to today’s median payment of $1,030.

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