[jonknee]

> the interest rates are too low for the banks to loan much. Once the rates rise, they will be handing out loans on the street corner.

That makes no sense if you know how banks and mortgages work--the loan's interest rate has little to do with the profit for the loan originator. The money is made on volume. When the bank makes a loan they almost immediately sell it to someone (lately the Fed) and have made the full amount of money they will ever make on that loan.

Now that interest rates have spiked off the bottom there are fewer loans being made and much less profit (banks are firing people in mortgage departments right and left). If the rates continue to increase it's going to greatly squeeze financial sector profits.