I'm slightly confused by 2 and 3, as I own cap notes and have friends with mortgages (in Australia).
Are mortgage rates and cap note returns in the US not tied to the federal interest rate?
Here, pretty much every note traded publicly will yield x% above RBA (reserve bank) interest rates, and most mortgages will be "variable rate" - ie they'll automatically adjust to be some function dependent on the RBA rate.
Are mortgage rates and cap note returns in the US not tied to the federal interest rate?
Here, pretty much every note traded publicly will yield x% above RBA (reserve bank) interest rates, and most mortgages will be "variable rate" - ie they'll automatically adjust to be some function dependent on the RBA rate.