Government bond yields are jumping and could go much higher, which is bad news for borrowers, homebuyers, investors, and anyone hoping cheap money comes back.

• The 10-year government bond rate hit 5.3%, and economist Steven Blitz sees 5.75% next and 8% over the long run.
• At those levels mortgage rates go into double digits, which would freeze home buying and stall the whole economy.
• The cause: the Fed cut rates under political pressure before inflation was actually beaten, repeating an old mistake.
• Savers get higher interest but still lose ground, because inflation is rising faster than what they earn.
• Washington's runaway spending keeps pushing yields up, and the government just tweaked how it measures inflation to make the numbers look better.

Outlook: Expect yields to keep climbing and squeeze shipping costs, food prices, and holiday spending into the end of the year.