THE 5.11% TREASURY JUST PUT EVERY PRIVATE DEAL ON TRIAL.
The ten year Treasury jumped to 5.11% Wednesday, its highest level since 2007, while the S&P 500 fell 0.75%, the Nasdaq dropped 1.13%, and the Russell 2000 lost 1.77%. The catalyst was not economic weakness; September business activity accelerated to its fastest pace in more than five years while cost pressures also increased, which is exactly the combination capable of keeping capital expensive.
That hurdle rate is already reaching the private economy. Mortgage rates hit 7.12%, commercial real estate debt is repricing, and every private transaction now has to explain why its illiquidity…
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