Friday , September 17 2021
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Tag Archives: everything bubble

Zombie J.C. Penney Finally Files for Bankruptcy, in Deal with Distressed Debt Funds. Stock and Some Bonds Wiped Out

Investors bet on this outcome for years. Covid-19 just sped it up by a few months. Department Stores Are Toast. By Wolf Richter for WOLF STREET. I’m in awe of how long these publicly traded companies with access to hyperventilating capital markets can hang in there and burn cash and ruin their brand and drive away their customers, and make expense-cutting their business model, and present this expense-cutting to investors to get more cash to keep the charade going, over and over...

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What Powell said About Negative Interest Rates, Their Effect on Banks, Jawboning, and Why the Fed Might Not Buy a Lot of Junk Bonds

The reasons behind the Fed’s No-NIRP stance: It doesn’t work and kills bank stocks. One of the most revealing statements. By Wolf Richter for WOLF STREET. Over the years, the Fed has waffled on all kinds of things, from what represents “price stability” to what it will do with regards to asset purchases. But there’s one theme that it has been relentlessly consistent about: a negative interest rate policy (NIRP). There has been a lot of clamoring for negative interest rates, ranging...

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US Commercial Real Estate Prices Plunged in April, Mall Prices Collapsed

Tenants’ collapsing one after the other without replacement has a pernicious impact on property prices. By Wolf Richter for WOLF STREET. Before the coronavirus, some segments of commercial real estate (CRE) were red hot, others were hanging in there or declining, and one sector, malls, has been in deep trouble since 2016, with prices plunging. Then came the lockdowns. Property prices in every CRE segment fell in April, even those that were red hot. And prices of mall properties got...

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Nothing’s Fixed: What’s Behind the Corporate Debt Bailout

Nobody knew what would trigger the next financial crisis, but just about everyone knew it would involve the record pile of corporate debt. And so it happened. Now the Fed fixed it… By Wolf Richter. This is the transcript from my podcast last Sunday, THE WOLF STREET REPORT: Something spectacular happened in April, despite the gut-wrenching phenomenon that 30 million people lost their jobs in the United States: In late February and early March, credit markets were freezing up and...

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Subprime Auto Loans Blow Up, Get Very Messy

With 30 Million Unemployed, Even Prime Loans Will Get Messy. By Wolf Richter for WOLF STREET. “Because consumer debt servicing statements are typically furnished to credit bureaus only once during every statement period, our snapshot of consumer credit reports as of March 31, 2020 is, in effect, largely a pre‑COVID‑19 view of the consumer balance sheet,” the New York Fed said today when it released its Report on Household Debt and Credit for Q1. So the credit-upheaval caused by the...

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THE WOLF STREET REPORT: Nothing’s Fixed – What’s Behind the Corporate Debt Bailout

Over the past two years, nobody knew what would trigger the next financial crisis, but just about everyone knew it would involve the record pile of corporate debt. And so it happened. Now the Fed fixed it… By Wolf Richter for WOLF STREET. Enjoy reading WOLF STREET and want to support it? Using ad blockers – I totally get why – but want to support the site? You can donate. I appreciate it immensely. Click on the beer and iced-tea mug to find out how: Would you like...

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Can Macy’s Survive this Crisis Without Filing for Bankruptcy?

Its unsecured bonds crashed 53% since Feb 14. It has been living off its real estate portfolio of “owned boxes” for years by selling them. By Wolf Richter for WOLF STREET. Macy’s, the largest surviving department store in the US, and still clinging by its fingernails to the last rung of the top 10 ecommerce retailers in the US, down from 7th place in 2019, may never reopen many of its stores that it hadn’t already decided to shutter before the crisis. In 2019, 26% of its $24.5 billion...

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How the Unicorn Blowup & Oil Bust Bleed into Commercial Mortgage-Backed Securities

CMBS get to eat it all: Amid overvalued vacant collateral, there is a new thingy: Tenants delaying rent payments and landlords asking for forbearance. By Wolf Richter for WOLF STREET. The office segment of the commercial real estate market – and the debt and the commercial mortgage-backed securities (CMBS) that are backed by it – are going through serious gyrations on a combination of factors. Companies have figured out how to make work-from-home manageable. Other companies are moving...

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Fed Massively Tapered QE-4. Hasn’t Bought Any Junk Bonds, Was Just Jawboning

Helicopter Money for Wall Street & the Wealthy: $2.06 Trillion in 5 Weeks. Regular folks, forget it. By Wolf Richter for WOLF STREET. Since the Fed announced its market bailouts and interventions on March 15, it has printed and handed to Wall Street $2.06 trillion. But here is the thing: This was front-loaded, and over the past two weeks, it has cut its bailouts in half, and it has stopped lending new funds to its SPVs that were expected to buy all manner of securities, including...

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How Will Covid-19 Lockdowns Hit the Housing Market? It Gets a Little Clearer

“In May, what market? I don’t see no market”: Realtor. By Wolf Richter for WOLF STREET. The “combined COVID-19 and oil shock” are going to do a number on the U.S. housing market, Fannie Mae warned in its monthly report on Wednesday. Actual data for homes sold after the lockdowns began will not be available for a while, and everyone is grappling with preliminary indications of just how ugly this is going to get. The Home Purchase Sentiment Index (HPSI) plunged 11.7 points in March to...

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