Originally Posted by
TransWorld
If one refinanced their home at say, 3% and taking their difference putting it in the markets is a long term (30 years or so) investment decision. The drop in the markets is short term. The markets will be coming back to new highs in the not too distant future. They always have, no matter how negative you feel right now.
The problem is people are emotionally driven, short sighted. They sell at a low point, and then panic and buy at a higher point.(Buy high, sell low, make emotionally driven stupid buying decisions.)
Refinancing at higher percentage, say, 5% has pretty well come to a halt. One does not refinance a 4% mortgage at 5%.
Define not too distant future. The markets aren't going to turn around until the Fed has killed inflation. And that isn't going to happen any time soon with these small interest rate increases.
We will be deep in a recession before inflation's under control. I don't expect the Fed to stop tightening until mid-2023 at the earliest so that's the earliest I see the markets starting to recover.
I am hoping that the S&P can hold 2500, but have my doubts. That's another 1/3 whacked off the value of the S&P.