The Wall Street Journal: With Interest Rates Up, Get Ready for Financial Drama
Article by Jonathan Weil in The Wall Street Journal
Interest rates have soared. Can financial blowups be far behind? Maybe, but often it isn’t that simple.
The yield on 10-year Treasury notes topped 5% this week for the first time since 2007. While not high by historical standards, it is a big move from less than 1%, where it was for most of 2020.
“Five percent is more or less the average of investment-grade rates since the time of Alexander Hamilton,” said James Grant, founder and editor of Grant’s Interest Rate Observer. “The problem is the structures that ......