Posted on 04/10/2023 9:17:29 AM PDT by cutty
I can’t decide if that’s good or bad. I mean, for me. If I want to rent commercial property maybe it’s good. Properties that can’t refinance will get sold at a discount and lease rates will come down. For other small businesses that is good too. For the country and the economy I am not sure. At least in the medium term. I guess the “great reset” has more consequences than imagined.
Tens of millions of illegal aliens need to live somewhere.
That is a key question. If you have to refinance the debt on a CRE property now at 7% when you were paying ~3% before... trouble. Especially if over-leveraged. If it is owner-user it should be easier to refinance it assuming the business can show that it has the cash flow to pay the loan.
I didn’t write there’d be no bailouts. I wrote that most commercial paper is held by smaller and regional banks, after you wrote most of it was held by the larger ones.
Around 70% of commercial paper is held by bank other than the top 25.
You’re likely right about bailouts - regardless of bank size. And yes, when smaller institutions fail the larger tend to gobble them up.
The problem with that is, sometimes nobody wants them. They view the assets as liabilities believe it or not, and they can be.
The Swiss government had to basically bribe and coerce USB into taking Credit Suisse.
What is a red flag is company cgbg is referring too is Blackstone. Not only are they not allowing REIT withdraws, but they are also defaulting on some very large loans. That IS a problem.
Not to be confused with Blackrock, which though very well known is onky 1/10th the size.
In most areas, especially blue areas, anything class-a office, and almost anything inside urban areas, including retail, is very much in "red flag" zone for sure right now.
It's very bad.
Sorry guys - I keep spellcheck and nannies off.
I also meant to say that last.I read, Blackstone hasn’t allowed REIT withdrawals since late last year... people cannot wait to run.
Thanks for the reply and no offense is intended. Perhaps I am conspiratorial, but many people much smarter than me are suggesting that Fedzilla wants to consolidate the banks into the big boys. At this point, it almost feels like the big 5 are part of the Fed.
They are all about control. I purposely bank with USAA and a couple of smaller local banks not for the insurance (I wish) but just because I don’t want to support the big banks. I am not too happy with USAA either but going to wait and see how this washes out before I make any big moves.
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