$20 trillion dollar USA mortgage market failure worse than 2008 happening as commercial real estate stagflation takes hold!
Inflation of the USD or United States Dollar soaring as the world's most popular fiat currency plummets in value, stealing away the buying power of working people in what sociological terms is known as hollowing out the Middle Class. Interest rates on the rise as the FED tries to grapple with stabilizing the economy. Commercial property values plummet as more people working from home online over high-speed internet.
Income inequality keeps increasing the relative wealth of elite income earners who pay virtually no income tax via elaborate write off schemes unavailable to normal people's who employer takes taxes out of their wages by legal means required that they cannot afford to lose from their pay.
Life's basics keep increasing in cost, grocery prices on the rise, toilet paper, gasoline, clothes, rent, housing, vehicles, even used cars selling for higher than the new MSRP crazy insanity happening now as people default on auto loans.
Home mortgage loan defaults are mounting as people cant keep up the high payments on homes they recently overpaid for. Or in many other cases the homeowner with the loan is house poor as so much of their income directly goes to paying for overhead costs like property taxes, maintenance, insurance, appliance failure repairs, plumbing leaks, electrical shorts, siding, roofing & windows failing & leaking & gutter clogging & landscaping that is falling behind.
Over $1 trillion in mortgages due within 2 years as interest rates increasing & commercial real estate vacancy rates keep increasing. For Lease "call so & so" signs all over the parking lots of commercial business parks in Bellevue along Bell-Red road on both sides.
The rent for our luxury two bedroom apartment with a garage connected increasing to over $4000 per month, so we are moving & not renewing the lease. We are putting most of our stuff in storage for $600/ mo & moving to a tiny 200sq-ft home on a farm nearby for $1200 per month all said. We view this as a bridge to weather the economic storm that is unfolding right now.
Its not one but many factors that are causing home prices to collapse or lose value in the near future. The prices nearby of homes that originally sold for under $60K are now above $800K, while minimum wage back then was only $2/ hr, today minimum wage is not $27 per hour to keep the income to home cost ratio in check, actually there was a big debate about even given people working entry level jobs $15/hr near Seattle about 10 mi or 16km west of Issaquah where we currently live sadly. I say sadly because of the obtuse cost of living in Anthology the overpriced apartment complex.
~70% of commercial mortgages are issued by regional smaller lenders, and a write down of such loans able to trigger serious trouble for the overall national financial system, significant because of the upcoming 2024 presidential election campaigns get going.
Remote-work from home rates increased because of Covid19 closures, and many people continue to work from home, causing office vacancies to soar to 18.6% in Q1 2023. An emerging train-wreck since office vacancy rate increasing dramatically negatively impacts the overall real estate market.
Since the starting half interval of the loans typically diverts most of the monies paid towards interest not principal, this means buildings are worth 40% less than 10 years ago as the interest rate now 6% not 3% like it was back then.
More than 10% of the commercial loans will not be able to be refinanced easily as the banks become more cautious about lending against real estate. You can see this in the declines of real estate stocks this year, many having fallen nearly 20% year over year.
Economists are not even clear what commercial offices spaces are actually worth, given that the largely service based economy enables high speed internet work from home over a laptop or desktop, something that is unlikely to change.
Its normal & predictable for a country to transition away from manufacturing & real labor work to a largely intellectual service-based economy since the human brain is stronger than average human muscles at making information work happen in teams of people working together at Amazon or Microsoft on software engineering for example.
Google, Amazon, TSMC, NVidia, Qualcomm, Comcast, Verizon, Team-Mobile, Sprint, AT&T, biotech, legal services, firmware, middleware, app development for smartphones, youtubers, there are whole new industries emerging based on content creators using information technology online directly. I even have a YouTube channel!
The lack of transactions & sales in the commercial office space sector tells us that we have no idea where things are at in terms of value, a predictable situation before a recession takes hold.
One of the problems with vacant real estate is that owners get to write off losses from their personal income taxes. This means the owners of real estate have no incentive to make real estate prices more affordable, so sky high rents remain for apartments & office spaces alike, while many of those spaces remain vacant because no one can actually afford to lease or rent them. Moreover the people who cant actually afford to rent or lease such real estate are more interested in living within 10 miles of Lake Washington, in a giant mansion that only well healed elite income earners can actually afford.
Have you ever heard the expression that you cannot have a society where everyone is an elite income earner? Its called there is no free lunch in physics in STEM academic circles. The worlds as we know it today is largely energized by burning finite depleting fossil fuels that make air & water pollutants when combusted, as the emissions harm public & environmental health alike.
We cant make 10 billion SUV's for everyone on Earth because human society lacks the mining capacity & smelting capacity to make that much steel, aluminum, copper, magnets, motors, the 20 tons of CO2 emitting for the productions of a Nissan LEAF for example, meaning that EV's are not eco-friendly & nor a good transportation solution for 10+ billion people for thousands of years.
All fiat currencies have failed in history, first from hyperinflation, then from renumeration efforts that do not create more value-added economy activity. This is why free markets that foster the creation of small businesses & value added economic activity creates therein shared wealth & prosperity that benefits directly or indirectly everyone else with furthermore jobs & opportunities.
How to create an economy, you educate people so they learn to want more stuff, prosumer cameras & all matter of fancy clothing & homes & vehicles of all kinds. Educated people tend to demand more of governments, so in trending economies there is also better government accountability to the citizens. We see governments of the world engage in despicable dishonest corruption collusion bribery & worse under economic declines & scarcity fear based mindsets.
The sad irony is that we have enough technology to make a global middle class or to give everyone on Earth a 6kw lifestyle with slightly less consumer goods abundances than a typical American today. We would have to build out 10,000 + nuclear fuel breeding reactors to make that much electricity, especially without burning away mountains to fuel coal power reactors that release nasty air pollutants containing radiactive waste & other toxic heavy metals that no one wants raining down into their neighborhood or residential district. Raise your hand if you want to actually breathe coal power emissions? I thought not!
Urgent need to decarbonize energy can be easily understood because energy effects all other topics in the world. Even you brain uses energy to move thoughts around. Literally we eat food for energy, fuel our vehiles or recharge them with energy. Its energy to move goods or to energize the machines in mineing and agriculture. To smelt metal you need thermal energy. To move you need metabolic energy. To think electrical energy moves between your brain neurons & muscles. Energy is the most important topic, especially making lots more electricity without burning carbon.
Enter Nuclear Fuel Breed in Fast Neutron or IFR reactors + lots of capacity for spent fuel rod reprocessing nearly entirely automated, with high throughput processing of spent fuel rods. I am saying and its scientifically and empirically true that we can make electricity for 10 billion people for 4000 years just using existing spent fuel rod recycling of existing nuclear fission reactor fuel rods that have been operating in more than 400 large GW scale grid power nuclear reactors for decades.
ROI for a large nuclear plant exceeds 9000% after 20 years online. Its our ability to make energy to energize human activity that creates wealthy & prosperity. With fossil fuel scarcity, carbon combustion creates income inequality because its running out. We have already burned all the easy oil making acid rain & air pollutants that cause human brain damage.
Its getting harder & more expensive to render crude oil from Earth's mantel. These are not my opinions, just factual. I am about what is true, like God, what is actually factual. I don't care about flat earth or big foot theories, I care about encouraging others to pressure lawmakers into making more nuclear electricity for everyone's benefit now & especially in the future, when climate change makes life harder for everyone. I am talking about during the nuclear or biological holocaust of world war 3 and world war 4.
I am talking about making clean abundant electricity to help rebuilt society after depot sicko's overrun my demonic influence from hell from Satan and demons, do things like what Vladimir Putin is ordering the Russian military to do the Ukraine & Ukrainian people / I am talking about war crimes & crimes against humanity that should result in Vladimir Putin being publicly executed. That sicko is shooting rockets into populated apartment buildings with children and innocent people who have done nothing wrong against Russia. Many of the people in the Ukraine are Russian people.
War itself is crazy because its human bad actors killing & destroying & stealing from people just like Satan, so war is EVIL! Let me say that again, WAR IS EVIL, its also wasteful, costly, expensive, eco-toxic & bad for everyone & everything, usually because a small number of deranged wackos have psychological problems & probably belong in a padded room of a mental hospital or prison at a minimum.
God instructs people in nearly all world religions to love one another, to teach the children to play nice. We owe it to ourselves & everyone to stop polluting the Earth with carbon emissions when we know how to energize everything with nuclear electric energy. Nuclear thermal energy. I am talking about nuclear thermal hydrogen gas production. Nuclear thermal processing. Nuclear powered ships to move containers about the world to enable global trade.
Replacing all fossil fuels with intelligent nuclear fission & fusion & ZPE & then dark energy capture & other high tech sci-fi ideas that are classified for military weapons use today. We can literally gain control over Earth's climate & weather, but not without moving beyond the constraints of finite fossil fuels. We need nuclear energy abundances able to boil off the oceans of the world levels of energy to gain God like mastery over climate & weather.
This will require a singular world government to achieve and is part of the end times when the Anti-Christ rises to power & consolidates the entire world and all countries, appearing as an Angel of Light with answers to all problems.
The false peace created will fool many into follow Satan into eternal damnation. See, Satan just wants to steal from God any way possible. God loves people, so Satan hates people and will do literally anything to kill steal and destroy. His greatest trick so far to convince people that he does not even exist, so they blame themselves or other people or God for everything that's wrong in the world.
The accuser hates humans, animals & nature and would just as soon delete life on Earth if God permitted him to. I wonder why God does not smite Satan out of existence but upon asking the Lord, the Lord told me that "In order for humans to have a true free will, we have to have access to making good or bad choices, so Satan is there to give us the ability to choose poorly. This might be a crude summary of what God actually said, but speaks to why God as we know of God allows that evil sicko Satan to continue living. We know that Satan will be destroyed by God, in the future. A new heaven & Earth will be created. All of this is described in the Christian Bible but especially in the chapter or book of Revelation.
No comments:
Post a Comment