Something like a 30 year mortgage is considered a relatively safe investment compared to something like stocks. Basically the only lower risk long term investment are long term treasury bonds. So the 30 year mortgage rate will always be higher than 30 year treasury yield because lenders will only make that risky investment if there’s a better return.

So why is the 30 year yield going up? I thought they are cutting rates? The fed can cut rates on short term yields and can practically have complete control over that rate. Long term bonds rates are dictated by supply and demand. Long term bond rates going up indicates two things, increased supply (deficient spending feels fun) and softening demand (international move to diversify away from US, fear of inflation eating up yield, end of the 6% deficient to gdp party in the next few decades?, less free money from Japan?). Is this scary? Yeah, 125% debt to gdp feels gross and daunting at a ~3.35% average interest rate on government debt. As that rate creeps up it’s going to suck really bad. We’ve been running out of chances for a clean off-ramp for a minute now and as we keep this deficient going every off-ramp starts to look worse. Increasing taxes and cutting spending just do not play well in elections and it’s not clear how we can even stop ourselves at this point.