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 if you want to know where the economy is headed don't watch the FED track this interest rate instead anything above four percent is bad and if you read this article on uh Business Insider what you'll see is that the 10-year treasury when it's over four percent uh you know when they make loans say they make loans at five percent and they bundle them into a mortgage-backed security and they sell them as an investment paying five percent well when U.S treasuries with no risk whatsoever well not no risk but

they contain low risk because they're going to make you work to pay them in the future out of your future taxes that's where the income comes from for treasuries but uh investors won't want your five percent Bond because they carry more risk than the four percent treasure so the mortgage lender must charge about seven percent for that 30-year fixed rate loan so uh loans jump so here is the uh the 30-year fixed rate mortgage now I wanted to take a closer look at these mortgage so here's the

10-year treasury note and I'm going to change this to all data and now it goes back to uh 2006 so you can see at the height of the real estate bubble it was four and a half percent but you know we were coming down from high you know the rates had been falling since the 80s and then they bottomed right here and they're bottoming here at a 10-year treasury is 0.6 percent and today it is 4.014 so anything above four percent is bad so as this Rises it becomes harder and harder to sell all of these packaged

loans uh that banks have made because they're just there's just not enough spread between what they can get as a perceived risk-free even though it's no longer risk-free uh and uh what the risk is that they're taking so here's the 10-year treasury going all the way back to 1962. and what you see here is you know this this rise and I keep on saying things like nothing like this in history has ever happened before uh and then you look at this area here and it looks like the steepness of

the rise and the the size of the the scale of it uh is equal if not greater back in the late 70s early 80s and but you know we're starting at about seven and a half percent here and going up to uh almost 16 percent so a doubling here we're starting at a yield of 0.55 and going up to 4.1 percent now if we take this and we do percent change from a year ago uh what you see is that yes nothing like this has ever happened in history before that's daily let's go monthly and see what happens

well yep nothing like this has happened before the magnitude of the uh change quarterly semi-annual annual yeah nothing I mean this is uh about four times greater than has ever happened before that you know in in the data sets that are available so here is the 30-year fixed rate mortgage in the United States and it looks like the same thing this looks like a really big move here from 2.73 percent all the way up to 7.08 percent that is a big move here you're talking about eight percent to 18

so this is a bigger move but since it's coming off of a higher launch pad uh it's it's not as large on a percentage basis so let's take a look at that percent change and whoa nothing like this has happened before uh so this is going to have an enormous impact here's annual and you can see nothing like this has happened before uh the the we're up at 80 percent so it's it's four times what happened back in 1980. uh the shock to the entire Financial system you know everything runs on debt and interest

rates now and everything is sensitive to it so um I you know this if affects everything and so uh the price of a typical starter home fell in San Francisco Austin and Phoenix bucking the national Trend so Nationwide things are going up but now we're starting to see the holes develop in the economy uh this is household net worth uh and it's the change percent change from a year ago so it's it's falling now um and you know it fell during the 2008 recession there are so many indicators

that say that we are currently in a recession right now but then there are other indicators pointing the opposite direction but this one is suggesting that yes we are in a recession and I believe that certain sectors of the economy are uh so the the big news though you know what is it that's going to implode the economy uh this is you just uh do a internet search for empty Office Buildings next Crisis we'll start with empty Office Buildings what will happen to all the empty Office Buildings

uh is it really The Perfect Storm uh are there why are there so many empty Office Buildings and then you do a search for office building mortgage default uh office landlord's default our defaults are escalating uh companies are defaulting on loan payments uh this one I'll show you the story later uh real estate giant Brookfield property defaults and then uh Forbes Office Buildings are still less than 50 percent occupied who should worry you should worry we should all worry two office landlords

defaulting may be just the beginning with at least 92 billion in office mortgages maturing this year this year 92 billion this year and so this is an ongoing problem now when you have investment real estate that you lease out the value of your property i s determined more by uh the the mortgage rates you know they calculate there should be a certain vacancy rate depending on how many uh offices or spaces you have Apartments whatever it is there's a certain vacancy rate that it's it's expected if it's too

low it means that you're not charging enough rent if it's too high it means you've got to drop your rent or there's something else wrong with the building so as the vacancy rates go up the value of the property declines it isn't the structure it isn't the location it's how many spaces are rented what is the vacancy rate and uh this is going this means that when a whole lot of these big uh landlords these uh property owners that own these multi-billion dollar buildings uh when they have to refinance

at these higher rates and their value of their building won't allow them to refinance for the amount that they've already got out that's already outstanding on their previous loan they're sort of screwed uh you know they have to do jingle mail it was called where you just mail the keys back to the lien holder now I want to show you how the FED has brought us in for a soft Landing each time in the past here are the six previous soft Landings and I've sped this up a little bit uh so that you

know it doesn't take so much time but this is hilarious so here is soft Landing number one soft Landing number two and then little pause here soft Landing number three about the same result soft Landing number four now soft Landing number five they almost make it and the the crash that ensues isn't quite as bad and soft Landing number six so there you have it the last previous fed soft Landings I hope you enjoyed this video please like And subscribe thank you very much