U.S. Interest Rates Rising Rapidly

click on chart to enlarge

Check out this chart of the 30 year U.S. bond yield. As can be plainly seen yields are rising dramatically as bond prices fall. This is not making the Fed or the Treasury very happy. Rising rates will derail any recovery. Rising rates is equivalent to spraying weed killer on the "green shoots" of economic recovery everyone is talking about. Monetizing the U.S. debt is scaring the hell out of bond investors and this is resulting in the Fed buying more and more of new issue U.S. debt issuance (with printed money). I expect yields to continue to rise this summer and then the next shoe will drop in the financial crisis and a big shoe it will be. This is the most important chart to watch, I will post it frequently.-Lou