No shortage of bubbles and troubles

As the residential-housing market deflates, similar bubbles rise elsewhere, making the case for higher interest rates in this 'Lady Macbeth economy.'

The stock and bond markets rallied after the Federal Reserve held short-term interest rates steady at its Sept. 20 meeting. Investors believe that the Fed has successfully steered the economy between too hot and too cold, and we're headed for a just-right soft landing with inflation under control and the economy growing at a solid pace. The so-called "Goldilocks economy" will push both stock and bond prices higher.