No that covers it
... i’m Having a tinfoil hat theory. Donald and Republicans coming up in polls. The swamp hasn’t been able to destroy him with Russia Russia, the economy is their next weaponized weapon to use on him — so like bingo market down, down, crash it and blame the R’s and Donald. This can’t be about interest rates because the economy can easily handle an increase. Who rolls big, big money all over the globe destroying economies in its wake...?
I got my brothers out on Tuesday.
On Monday, an entire asset class was destroyed - XIVs. There was a 91% swing which activated a termination event, and poof, $3.4B gone.
Then HNA, one of China’s biggest companies, their Real Estate Group missed a $270M interest payment. Technical default - triggering event.
Wednesday, a calmer day, the Plunge Protection Team was wearing out the buy button it appeared.
Thursday, HNA is forced to sell billions in US properties - immediately. They are $15B in the hole. They own a ton of Deutsche Bank stock too.
The kindling under this is companies borrowing money to buy their own stock. The loans stay, the value will go away.
Add to that the $1.2B in automotive loan debt, the automotive industry’s addiction to leasing, and the 9% default rate on auto loans (more than 20% now made to people with FICO < 660).
Automotive is 3% of GDP and 5% of overall employment. It impacts 50% of all US business in some way.
Student loan defaults are through the roof, 6 year (yes, 6) graduation rates are below 60 percent.
Add it all up and there is no middle class to get your economy back on track.
Enter the tax cut - repatriate cash in order to get hiring up and let people work their way out of the debt.
If China doesn’t collapse, it might work.
Pressure on interest rates, however, will make consumer borrowing on autos and homes more expensive. It MAY also, however, drive the price of homes down, which would be good.
If you throw in any bad actors out there trying to tank the market to spite Trump, its a tall order for anybody, even a savvy dude like President Trump.