Rising rates may hammer the stock market

The most widely watched gauge of interest rates, the yield on the 10-year Treasury note, hit 1.87% on Tuesday, the highest since January 2020.The big picture:

The growing market weight of Big Tech in indexes like the S&P have tied the fate of the markets to these rate-sensitive giants. Duration is expressed in years — in theory, it's based on how many years worth of dividend payments it would take for investors to recoup their investment. That means a 1 percentage-point increase in rates would be expected to send stocks down nearly 37% — wiping out the gains of the last year and a half.It's important to keep in mind that these predictions are estimates based on Wall Street models, which have a notoriously loose relationship to reality.

Isn't it obvious by now, as their projections miss month after month and they failed to forecast the Great Recession, that most economists are like bad weatherpeople who only get it right every so often? I mean, how many economic messes have they missed or made worse?

I’ll keep listening to Marketplace to learn what’s going on.

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