AI Summary
5 min readThe yield on the 10-year Treasury note hit 5.135% today, a level that matters in thousandths of a percentage point when the U.S. government borrows as much as it does. That number is the through-line of this episode: the cost of money is rising, and it is reshaping the housing market, the bond market’s own temperament, and the broader economic mood.
The housing market’s strange new equilibrium
The 30-year fixed-rate mortgage now sits at nearly 7.2%, a two-year high. Unsurprisingly, mortgage applications have dropped for the third straight week. But something less intuitive is also happening: more homeowners are deciding to list their homes. Daryl Fairweather, chief economist at Redfin, explained that many sellers are simply tired of waiting for rates to drop. They have realized that the better market they were holding out for may not arrive soon. More sellers mean more supply, and with demand slowing, home prices have risen only 2% year over year — slower than both overall inflation and wage growth. That would be welcome news if not for the mortgage rates themselves.
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What you'll learn
- 1 (00:54) **Bonds as the Cost of Money** - Kai Ryssdal introduces the episode's focus on bonds, framing them as the cost of money, as the 10-year Treasury yield hits 5.135%.
- 2 (02:08) **Housing Market: Demand Down, Supply Up** - Sabri Benashour reports on a paradoxical housing market where high mortgage rates are suppressing demand while more homeowners are deciding to list their homes.
- 3 (04:30) **Interview: The Epic Story of Bonds** - Kai Ryssdal interviews Robin Wigglesworth of the Financial Times about his new book, "A Fabulous Debt," which argues bonds are the bedrock of the financial system.
- 4 (07:10) **Analyzing the Current Bond Market** - Wigglesworth assesses the current rise in bond yields, noting the 30-year at 5.3% and the 10-year near 5%, which makes U.S. debt servicing more expensive.
- 5 (10:17) **Treasury Secretary's Limited Influence** - The discussion turns to Treasury Secretary Scott Bessent's attempts to manage the bond market, which Wigglesworth argues are ineffective and potentially counterproductive.
- 6 (11:19) **The World's Oldest Bond** - Wigglesworth shares the story of a 400-year-old bond written on goatskin, issued by Dutch waterworks, which he attended a birthday party for.
- 7 (13:37) **Peloton's New Strategy: Treadmills** - A brief segment covers Peloton's announcement that it is going "all in" on a new line of treadmills, pivoting from its pandemic-era spin bike fame.
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Guests on this episode
Show Notes
Bad news first: Mortgage rates are topping 7% and, fittingly, mortgage applications are down. On the bright side, home prices aren’t completely frozen and listings are actually up. Question is, in this stuck housing market, when will things budge? Also in this episode: A running resurgence parallels popularity peaks in the aughts and ‘80s, Nashville-style hot chicken sees international success, and writer Robin Wigglesworth argues the bond market built the modern world in his new book, “A Fabulous Debt.”
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