One the nation’s most prominent economic commentators issued a warning that further increases in mortgage rates could put a major dent in the economy.
CNBC’s Jim Cramer used an appearance on “Squawk on the Street
” to warn that the impact of mortgage rates that rise too much and too soon will be felt as far afield as corporate earnings and consumer spending. Cramer pointed to the 30-year fixed mortgage rate, which hit 4.85 percent on Thursday after hitting a 4.9 percent level the week before—one year ago, that rate was 3.88 percent.
"We're going to see more and more bad earnings because a five percent mortgage is the end, that is the line in the sand," Cramer said. "The mortgage rate is very high in this country."
Cramer also criticized Federal Reserve Chairman Jerome Powell for rushing rate increases in an attempt to bring back a normalized monetary policy after years of historically low rates. The Fed has raised rates three times this year and many economists predict another hike in December.