As a follow-up to the post directly below, I wanted to point out that John Mauldin, in his weekly e-newsletter, remarks:
As a prelude to a paper we are going to examine in detail in the next few weeks, there is reason to believe that long term interest rates might be at least 1% higher and perhaps as much as 2% without foreign buying of US government debt. 10 year treasuries at 6% would mean that 30-year mortgages would be well over 7%. That would create quite a slowdown in housing construction and at least put a lid on the rise in home values, if not reverse the trend. That would certainly slow the economy down.