It is not yet clear whether rates are rising because investors truly believe the economy will develop enough steam over the coming months to overcome the added shocks which will be coming as the government stimulus winds to an end, which for many state and municipal governments will mean cuts both in programs and in headcount, or whether the markets are spooked by more money printing and the Fed stating that the goal of QE 2 is to stimulate inflation which will make those holding bonds at today's rates wish they had sold.  Whatever the reason, the bottom line is that investors are selling Treasury notes and bonds and mortgage-backed securities which means rates are inching up.  Yesterday the bond market experienced significant selling pressure which strenghtened during the late afternoon.  This morning, despite Initial Jobless Claims for the week ended 11/27/10 that came in at 436,000 vs expectations of a 422,000 to 425,000 figure and Continuing Jobless Claims for the week ended 11/20/10 that came in at 4.270 million vs expectations for a 4.2 million number, bonds are still down as investors adjust to a completely changed landscape in terms of portfolio allocation perspective.  Conveniently, now that there has been a major adjustment in outlook for fixed income investments, the description of the "new normal" view of the world espoused by Pimco's Bill Gross and Mohamed A. El-Erian, which led analysts to believe the 10 Yr US Treasury Note could drop to 2% and 30 yr mortgage rates might drop to 3.5%, is being used now to describe a period of extended high unemployment rather than extended low interest rates.  High unemployment was always a part of the "new normal", it is just the low rates part that is being dropped.  The 10 Yr Treasury which was at just under 2.5% prior to QE 2 is on the cusp of breaking the 3.0% threshold, which by historical standards, is still very low, but which has been a surprise to most analysts who expected that QE 2 would have the opposite effect.