They also just seem to be able to declare reality and go with it. Just tell people the economy is strong and everyone follows what their TV says.I'm going to take the contrarian position here and argue that the "they can print money longer than you can stay solvent" adage is applicable right now, and I don't think we'll be in recession for a little while still.
That being said, I am stacking cash and preparing for the worst. Interest rates dictate that "cash is trash" is less applicable now.
They also just seem to be able to declare reality and go with it. Just tell people the economy is strong and everyone follows what their TV says.
Office buildings in southern California. A healthcare operator in the Northeast. A bankrupt oil and gas company in the Atlanta suburbs.
These were among the assets that became the source of lending problems for regional banks in the third quarter as corporate borrowers and commercial real estate began to show more signs of strain.
In recent weeks many mid-sized financial institutions across the country reported that nonperforming loans, a measure that tracks borrowers that are behind on their payments, rose during the third quarter. They also disclosed mounting costs from unpaid debts written off as losses.
Of 18 regional banks analyzed by Yahoo Finance with assets ranging from $50 billion to $250 billion, 15 reported jumps in nonperforming loans when compared to the same year-ago period. The average rise was 80% more than the third quarter of 2022, and up 8% when compared to the second quarter of this year.
My mortgage guy believes the Fed is going to bring mortgage rates back down to around 5% within 12-18 months. He says that's the word they're putting out. He's expecting anyone that got a higher interest loan in the past year, or especially now, will be generating tons of refinances when that time comes. He's expecting a boom.View attachment 624
It's happening.
View attachment 625
WSJ: https://archive.is/cIofJ
The Mortgage Market Is So Bad Lenders Want Ex-Employees to Give Back Their Bonuses
He could be right but he's still missing critical info to hype certain things/his business. The plan is to increase unemployment dramatically. Rates lower when people are out of jobs and credit is tight may be irrelevant. We shall see.My mortgage guy believes the Fed is going to bring mortgage rates back down to around 5% within 12-18 months. He says that's the word they're putting out. He's expecting anyone that got a higher interest loan in the past year, or especially now, will be generating tons of refinances when that time comes. He's expecting a boom.
I'm not so sure. I remember interest rates going high for 25 years from 1978 to 2003 or so. I think current rates could be the best we'll see for a long, long time. 8% is still lower than anything from that 25 years I just mentioned.
Of course, it's possibly my mortgage guy knows all of this, but he's pushing the idea that rates will come back down to make people think the current high rate will be temporary.
My mortgage guy believes the Fed is going to bring mortgage rates back down to around 5% within 12-18 months. He says that's the word they're putting out. He's expecting anyone that got a higher interest loan in the past year, or especially now, will be generating tons of refinances when that time comes. He's expecting a boom.
I'm not so sure. I remember interest rates going high for 25 years from 1978 to 2003 or so. I think current rates could be the best we'll see for a long, long time. 8% is still lower than anything from that 25 years I just mentioned.
Of course, it's possibly my mortgage guy knows all of this, but he's pushing the idea that rates will come back down to make people think the current high rate will be temporary.
Treasury bond buyers want higher rates because huge fast growing debt is risky, so the Fed will have to be the buyer of own bonds. Inflationary stuff anywhere you look.
To be fair Target is not a very well managed retailer so they could be ceding market share. Better to look at how Walmart and Costco are doing.Makes sense that the Fed will follow in Japan's footsteps.
BoJ owns more than half of JGBs:
'Target has posted seven consecutive quarters of declining sales of discretionary items, such as apparel and toys, in terms of both dollars and units. "But even in food and beverage categories the number of items they're buying, has been declining."'