Rising long rates threaten the bellwether housing industry as well as consumer spending. The higher [bond] returns begin to compete with stocks for institutional affection.

Worries of a housing-led consumer spending bust are overblown.

The higher that rates go from here, the more the bond market needs to respond to them. The bond market should finally respond to upward pressure on long-term rates.

The cooling U.S. housing sector should apply a dampener to consumer spending as 2005-2006 unfolds, but some of this could be offset by still-decent job growth.

Tomorrow (Tuesday) we get numbers on industrial production and housing and big reports from Intel, Coke, Johnson & Johnson -- maybe that can turn us around.

That said, January housing starts were the highest in over 20 years, and that is based on higher rates than we are currently experiencing, ... All in all, the little run-up in rates that occurred this week will not be enough to cause a significant slowdown in current housing market activity.