aardvark

Dubai's Debt Woes Could Further Unhinge U.S. Commercial Real Estate Sector

The basic problems: First.How do you fill shopping spaces when people can't afford to shop? Second.How do you fill office spaces when business will be contracting as the US tries to compete on an aggressive international scale without lowering living standards? Where do you expect a demand for commercial real estate to come from when basic innovation for climate change and energy alternatives are considered irrelevant? Third. Depreciation will continue to accelerate as usage of commercial space declines which will impact an array of financial insturments originally based on explosive growth expectations.


On Nov 29 10:36 AM Tack wrote:

> The linkage between Dubai World and U.S. commercial realty prospects
> and cashflows is virtually nonexistent. This article, like most "scare
> pieces" has a provocative title and raises fears without demonstrating
> any relationships or causal effects other than self-fulfilling fear.
>
>
> In fact, U.S. commercial realty entities may represent one of the
> best "bottom-fishing" opportunities in the market today. Share prices
> in the sector have been decimated, on a percentage basis, far beyond
> any past downturn, even though projected maximum default rates are
> not appreciably different than the 1989-1992 contraction. Debt and
> preferred shares in many commercial-realty entities represent especially
> good yields, while affording atypical capital appreciation opportunities.

Risk Assets and Other Greenback Fun

Let me be brief...Yves Smith is like a broken watch...right twice a day. Smith totally missed the manipulation of ratings agencies that began this fisaco.

"Ratings agencies, quite rightly, don't simply plug a bunch of ratios into a formula to generate a rating. If they did, they'd add precious little value. Instead, they have a dynamically-changing set of criteria which they use to help them make an informed decision as to what their ratings should be." In other words, ratings agencies don't need standards, just a good sense of smell.

Upside GDP Surprise: Misleading

Looks like an accurate forecast of pain to come. It would be interesting to see how politics have affected GM as a case study similar to pentagon pet projects for their idiot weapons.

American Austerity Is About to Begin

If the US was put up for auction who would buy it? No one with any sense because the liabilities far outweigh the assets, almost exactly like GM. So how do you make the US a good buy? You reinvent the economic structure. You rebalance an overweight, unproductive, uncompetitive, overpriced, bankrupt, economy and start over again. You reinvent, streamline, focus on necessities, and work like hell to survive. No more debatable wars of choice, no more redundant medical systems, no more tax breaks for the wealthy , no capital loss deductions, no third- rate public schools. You bite the bullet before the bullet bites you.

Home Inventory Measure Falls to April 2007 Levels

"there has been a significant improvement over the last year in the balance of homes available for sale relative to the demand. "

Improvement except for one thing, rising foreclosure rates and zombie homes kept alive by banks so they don't have to do the FEARED MARK TO MARKET.

Commercial Cataclysm? Moody’s / REAL Commercial Property Price Index (July 2009)

If commercial real estate is doing so badly why does SRS keep going down?

Fitch, S&P Downgrade Subprime, Jumbo RMBS Transactions

Fitch Ratings and Standard & Poor’s and Moody's ought to be downgraded to criminally felonious and "their entities" should be wiped out and imprisoned.

Does America Need to Make Things?

Making nothing is a sure way to end up servicing nothing, then what?

Forecast: Volatility

Let's say there are a minimum of 5,000,000 jobs lost over the past year,not counting reductions in pay/hours of remaining jobs. If each job is valued at $30,000 per year this means $1.5 trillion has been taken out of the economy,the tax base, and has required unemployment support. Add to this the ramifications of the impact of existing indebtedness, foreclosures,etc and the green shoots don't look so green. Reality isn't nearly as much fun as Disneyland.

John Hussman: Market Internals Suggest Heightened Concern

Maybe the green shoots got overshot?
Men, man your bubbles.
Ladies count your unhatched chickens.
Boys and girls buckle up.
The deleveraging train is leaving the station.

U.S. Unemployment - Is It Really So Bad?

You're forgetting a few things. Banks weren't up to their behinds in funny paper. Standard and Poors was independent and ratings weren't skewed to produce derivative funny money. The personal debt levels weren't nearly as high. International competition meant primarily Japan. The trade balance was positive. National debt wasn't disguised by loans from China.

America's Missed Opportunity

For years Americans have been inclined to worship a cowboy mentality that puts livable values far behind flash and zoom and false bravado. So we have expensive tastes...gourmet you might say... in giant stadiums, exotic cable tv, mini-Ferraris, last ditch medicine, witless politicians, and brutal wars more for teenage macho than national security. Maybe we ought to take a lesson from our enemies and learn less is often more.