With everyone asking "Are we better off than we were 4 years ago", we've been revisiting some of the stuff we were talking about back in 2008/2009.

One thing we recalled (with the help of CNBC's John Carney) was that everyone thought that there would be an Option ARMageddon.

What people knew is that a lot of people had mortgages whose interest rates would be adjusted in the 2009-2011 period. They got the mortgages with teaser rates during the boom, and the expectation of many was that rates would surge and that these homeowners would get crushed. This fears was pervasive, and the below chart (which originated from Credit Suisse) was EVERYWHERE for a time.

Option Arm Credit Suisse

As you can see, 2011 was supposed to be a particularly horrible year.

But something funny happened.

Rates didn't surge. In fact, they're at all-time lows, and there never was that second wave of homeowners who got destroyed on their Option ARMs.

And if anything, it may have been a self-defeating prophecy, as these fears of an Option ARMageddon helped contribute to the general freakout about mortgage bonds during the bust.

If nothing else, it's a good reminder that things we fear the most often don't turn out to be much.

And arguably it makes a good case that the Fed can create current gains by ensuring low rates into the future.