Exclusive: Wall Street is in for a rude awakening, former NY Fed president says

New York (CNN Business) Wall Street threw a fit last week when Treasury rates spiked.
Former New York Fed President Bill Dudley is warning that the temper tantrums are only just beginning.
"They want the economy to overheat," Dudley told CNN Business, referring to the Fed.
"Moving to 1.6%, that's nothing," said Dudley, who left the NY Fed in 2018 after nearly a decade there.
He predicted Treasury rates will eventually climb to between 3% and 4% — or higher.
"The bond market right now is a little bit unrealistic about their expectations for the Fed.
They certainly want the Fed to stop this," said Dudley, who was previously a top economist at Goldman Sachs.
Bond market bubble fearsBut all of this optimism, piled on top of easy money from the Fed and aggressive stimulus from Washington, is raising concern about bubbles emerging in financial markets.
The former NY Fed chief said it will be a "big adjustment" for investors when Treasury rates climb back to between 3% and 4% because "extraordinarily low" rates have supported stocks.
"I don't see an equity market that's particularly expensive relative to the bond market," Dudley said.
Dudley said he's not sure if he would use the word "bubble," but said low Treasury rates are "absolutely not" sustainable.
Celebs are getting into SPACsHigher rates, whenever they arrive, will act as a deterrent for some of the more speculative activities on Wall Street.
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