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Mortgage rates have fallen back to historic lows, tracking declines in yields on American government bonds.Perhaps the best news for housing has come from the labour market.
But Treasury bond yields rose during the Fed's two QE programmes; the declines in yields came in between the two programmes, and between the end of the second programme and the start of Operation Twist (see chart 1).The odd behaviour of Treasury yields does not in itself prove that QE was ineffective.
Without changes in agricultural practices and technologies, staple Texas crops like corn and cotton will likely face significant declines in yields.
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In southern Australia, for example, declines in yield of 25 30 percent in second rotation radiata pine (Pinus radiata) plantations have been corrected by a number of means, including intensive silviculture (site preparation, weed control, fertilization) during the early stages, retention and management of forest debris (leaves, branches, etc).
In severe cases, lodging can result in breaking of the stem or pulling out the roots, blocking the transport of water, minerals, and photoassimilates and leading to declines in yield and quality.
This decline in yields should push mortgage rates to or near record lows, which could spark a mortgage refinancing boom.
The decline in yields means investors are beginning to seek safe haven in low-risk government debt.
However, American bond yields were roughly the same in that year as in 1996; the big decline in yields is more recent.
Lacking enough information about today's wheat varieties, the scientists were not able to calculate a precise decline in yields produced by the heat.
But given the scale of the decline in yields, and the fickleness of stockmarkets, it would be foolish to bet against the bond market's judgment.
In addition, the decline in yields, which has already pushed home mortgage rates back down near four-decade lows, should inject more life into the economy, economic analysts say.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com