The 30-year fixed mortgage averaged 3.04% in 2020 and 2021, according to Freddie Mac’s weekly survey. The 15-year rate: 2.44%. Housing money was almost free…almost. Through June 22, the average 30-year fixed rate was 6.43%, a substantial increase.

What happens when an immovable object runs into an irresistible force? In today’s investing world, the Federal Reserve has been that immovable object, jacking up interest rates in order to quell inflation. For now, the Fed is betting it can keep its attention on inflation while using other tools to support banks that are in need.

The Federal Reserve was established in 1913 in response to the Panic of 1907. It was initially designed to address bank panics. Its initial purpose was to lend when no one else was willing. But recent events are a reminder that confidence is the cornerstone of the financial system. We place funds in banks because we expect immediate, unfettered, and full access to those funds.

The Federal Reserve was established in 1913 in response to the Panic of 1907. It was initially designed to address bank panics. Its initial purpose was to lend when no one else was willing. But recent events are a reminder that confidence is the cornerstone of the financial system. We place funds in banks because we expect immediate, unfettered, and full access to those funds.

We have all seen the headlines surrounding 3 banks with regulators stepping in to run the bank and get deposits back to depositors. The pressure these banks went through was due to their unique clientele, their decisions on what to do with their deposits, some of their deposit requirements, and a change in interest rate policy.

The economic distortions tied to the pandemic and the government’s massive response to prop up the economy have been far-reaching.

The Fed's road to 2% annual inflation took a curious turn last week, disappointing some investors that had been expecting continued progress on inflation.

But given the inflation data last week, January’s blockbuster payroll number, and the upturn in consumer spending last month, investor expectations of a near-term peak in rates have receded.

Housing sales tumbled since the beginning of 2022, as the jump in mortgage rates forced many buyers to the sidelines. Existing home sales fell a whopping 38% last year, according to the National Association of Realtors.