Not high oil prices, the petrodollar agency will raise the ten year instead. Janet will go on a rate cycle while pensions come apart.
Janet has a problem. When the ten year rate rises, the pension fund need space to adjust, and Janet has no choice but to borrow on the short end for fear of driving the ten year faster than pensions can adjust.
No, this is not a conspiracy, this is the finance community trying to avoid another 2009 oil shock. Neither the petrodollars masters not Janet nor Powell want the California pensions forced into partial collapse.
More heating:
The impact is on Home Depot first, then housing second. So housing is getting the double whammy from rate hikes and supply prices. This is all built into the cake as price is ex post, congestion has aleady happened and cannot be reversed. Powell and Yellen soon be having shocks to their beliefs.
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