Rising Treasury Yields Signal Challenges Ahead for Stocks, Housing and Other Interest Rate-Sensitive Sectors

Treasury yields near 20-year highs due to high government spending and hot inflation, with implications for housing, autos, banks, tech, and stocks.

10-year Treasury yields could easily reach 6% in 2024 based on theoretical, practical, and historical reasons. This could mean 9% mortgage rates and 8% car loan rates.

The recent 25% stock market rally was driven by higher valuations, not earnings. This is unsustainable if inflation persists and yields keep rising.

Government borrowing with no tax increases to fund spending puts upward pressure on yields, "crowding out" potential home and car buyers.

The economy was built on 0% rates for years. Business models dependent on cheap financing may crack as yields rise further.