Hey polo, I'm no expert on interest rates, you may well be right. Not soely a call on nterest rates. The fed is putting pressure on banks to tighten lending standards on housing. Interest only, teaser rates, and negitive amortization loans. I didn't know there was such a thing as a negitive amortization loan until 6 months ago. Every month the homeowners blance is higher than the month before. That is the most dumbass thing i've ever heard of. There isn't a lot of doubt that the fed wants to stop the excess in housing prices and lending. If they are successful my bet is the consumer spending will slow. You point about the higher wages is something hadn't thought of. I agree that minimum wages way too low. If wages did go up that could help the consumer. I'm a republican but the party is wrong. They need to be a little more worker friendly.