💥 THE IMMOBILE BOMB
🔺 A new bomb is ticking beneath the U.S. financial system — this time in the commercial real estate sector. While the Fed debates inflation, the real problem lies deeper: $4.9 trillion in mortgages have been issued against offices, malls, and warehouses — nearly double the amount tied to housing in 2008. Already one in eight commercial mortgages is in default — the worst rate on record.
🔺 Bank balance sheets are stuffed with “toxic” securities that not long ago were considered safe: they were backed by real properties and corporate tenants with stable cash flows. But the economy has changed — e-commerce and remote work have crushed demand for offices and retail space. Buildings stand empty, rental streams have dried up, and vacancy rates continue to rise year after year.
🔺 In theory, banks can repossess the properties — but there are no buyers. Keeping them on the books means losses; repurposing them is nearly impossible; selling at collateral value — unrealistic.
🔺 The Fed can’t “print” demand for offices, but it can temporarily inflate bank profits to absorb the shock and gradually write off dead assets over 5–10 years. Beneath the concrete foundations of American cities, a new financial bomb is quietly ticking.
#crisis
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