Home prices hit a slick $1,000,000, while soaring office rents blow up enterprises with real business models. It’s crazy. It’s powered by hot money from around the world. Then comes the moment when the hot money evaporates.
Spreads between short-term and long-term Treasuries at lowest since Financial Crisis. Buyers will be punished. So the mystery: “Who the heck is still buying?”
The world’s largest wealth manager is “very worried” about “the lack of liquidity” that could wreak havoc during the sell-off. It reduces risk “over the full spectrum of assets.”
by Wolf Richter • • Comments Off on Canada’s Magnificent Housing Bubble at Risk, Fitch Says
Solution? Not raising interest rates. EVER. That would prick the bubble violently. Instead, Fitch says, the government should “engineer a soft landing.” Good luck!
35,000 M&A deals will likely be made this year, promising “efficiencies” and “synergies,” hence job cuts. So Microsoft, which bought Nokia’s handset unit, is planning the largest in its history…. The M&A frenzy of 2007/8 was followed by the Great Jobs Crisis!
by Wolf Richter • • Comments Off on Yellen Warns Investors
Yellen pokes at bubbles in momentum stocks, leveraged loans, threatens to end ZIRP sooner, more rapidly “than currently envisioned.” Fasten your seatbelts.
Wearable camera-gadget maker GoPro doubled in the days after its IPO. The media went gaga. But last week, it began to tank, just before Barron’s calamitous article.
by Wolf Richter • • Comments Off on Who Will Be Assigned To Eat The Losses ‘Hidden’ On China’s Balance Sheets?
Transferring bad debt from local governments to the central government does not address the cost of resolving the bad debt. Because bad debt doesn’t just disappear.
