Lemme guess... all off sudden Commercial Real Estate is vital to the US economy and cannot be left to be decided by market forces...
I'm also going to go out on a limb and bet that a lot of CNBC personalities are soon going to be getting increasingly angry over nothing being done to address this.
No bailouts! This is capitalism at work. Inefficient and weak companies fail. Low rates stifled innovation and allowed people with cash to continual purchase and inflate prices.
The only "bailout" will be emergency cuts to interest rates and expanded fiscal policy (Q.E.) Still a bailout, in all but name.
If one of the big five banks teeters, then there will be a real bailout.
@SomberKoalaSocialist2mos2MO
Bailouts are a guarantee after the Great Recession - going forward, the large donor class will have their gains privatized, and their losses nationalized. Just look at the ludicrous bail out of Silicon Valley Bank as a recent example.
Why do you think large banks and the private equity ghouls would take such outrageous risks for such low coupons? It is risk free.
@SolidPolentaRepublican2mos2MO
It's not a question of "will there be bailouts," but instead "who will get the bailouts?" Will it be the building owners, or will it be the banks who made the loans?
I believe you could make a rational argument that the issues that caused the commercial real estate devaluation and credit shortage were both caused by the federal government to some extent. Buildings lost value when the government mandated remote work which emptied the buildings, which killed the retail and restaurant operators who depended on these workers. Private enterprise did not crash that model?… Read more
Likewise, the banks have had to deal with new liquidity requirements and a cost of funds increase they did not create.
@LovesickCraneSocialist2mos2MO
The only thing that is allowed to fail today are mom and pop businesses. Everything else is bailout eligible, especially if you can check a certain box that makes you extra special.
