CRE Fire! Office Valuations Plummet As Fed Raises Rates To Fight Inflation (US Gross Domestic Income YoY Fell To -0.8% In Q1, NOT A Good Sign!)

Commercial real estate (CRE), particularly office space, reminds me of the Arthur Brown tune “Fire!” except that Jerome Powell of The Federal Reserve is the God of Hellfire! While fighting inflation caused by … The Federal Reserve and insane Federal spending (aka, Bidenomics). Call this the Over, Under, Sideways Down economy. The top 1% are doing quite well, while the lower 50% of net worth households are struggling.

The Q1 2023 NCREIF Office property (value) index shows declining office value since Q2 2022 as The Fed began raising its target rate to combat inflation.

From Trepp, we have this shocking table showing the decline the average total value loss over the span of around a decade. The oldest buildings experienced the largest reduction in value of 60%, and the newest experienced the least (but quite substantial) reduction of 52%. Although the newest buildings performed the best relatively, their 52% value reduction is easily the most concerning, and displays truly how much distress is present in the office sector.

Well, REAL gross domestic income fell -0.8% YoY in Q1 2023 as M2 Money growth crashes. Not a good sign for the US economy or commercial real estate.

Of course, office properties are suffering from almost out-of-control crime in major American cities and the desire of workers to work from home rather than commute to work in cubicles.

But never fear! We have massively corrupt and compulsive liar Joe Biden as President!! He is the President of The 1%! Not the other 99%.

fighting inflation by raising prices does not make sense in the current economic quagmire.

Sure it does.

Because they are not fighting inflation. They are benefitting from inflation. "They", being various politicians and the extremely wealthy individuals who sponsor them. Any person or group in a strong power position will raise prices as much as they can and place their assets in non-currency forms. They win. Everybody else loses.

Very specifically, people who are getting paid from the government are extracting their income from people who don't get paid from the government. That is a lot of people with a vested interest in inflation as a hidden tax source for their income.

"If you rob Peter to pay Paul, you can always count on support from Paul" (Proverbial).

The "we are fighting inflation by raising rates" is a deception to keep the "little people" distracted just a little while longer, while the powers-that-be continue to pick their pockets.

If you are going to tell lies and deceive people to get something from them or harm them, it works better to tell bigger lies. That is what we are being offered as explanations for inflation. And quite a few other problems too.

(n 2008)

U think it will, this disaster of Joe Biden. But that’s just me.

So I say BidenDepression 2023.

Possibly Spring, 2024.

It’s a charade and a house of cards.

Darn small screen on phone

(in 2008)

I think it will, this disaster of Joe Biden. But that’s just me.

So I say BidenDepression 2023.

Possibly Spring, 2024.

It’s a charade and a house of cards.

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