...Article from The Hill, “Powell: ‘There will be bank failures’ caused by commercial real estate losses”: Jim believes this is just the start and that it will be worse than Powell is stating. Regional and sub-regional banks will be hit hard. “When you start hearing about “‘Mark to Market’'” in the near future, run for the hills,”
... it is not necessarily bank failures (insolvency) but more like incompetence, no ability to lend, no idea how to handle repossessed properties. Consolidations will be common. The net is much wider than almost all people understand.” Jim is a real estate developer in a strong market. He is on the front line and seeing what others have yet to see.
... there is nothing systemic I believe. It is more about the viability of some over stretched banks and a multi year process of working through CRE pain.
...The other issue we face from challenges with mostly regional banks is the reduced credit being loaned out.
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