There’s Just No Good Way Out.
Commercial Mortgage-Backed Securities backed by hotel and mall properties get hit the hardest. Mall-REIT CBL failed to make bond interest payment yesterday.
CMBS get to eat it all: Amid overvalued vacant collateral, there is a new thingy: Tenants delaying rent payments and landlords asking for forbearance.
Neither the Fed nor the Treasury can bail out brick-and-mortar retailers.
In good Financial Crisis manner, stuff blows up despite the Fed’s effort to stem the chaos. Now hoping for taxpayer bailouts.
S&P made up for its tardiness by downgrading the CMBS in one fell swoop by 9 notches from AAA to BBB-, just one notch above junk.
“I want to see rating agencies improve their performance before they contribute to another meltdown.”
It’s so big: Soul searching in the Commercial Mortgage Backed Securities market.
“If this isn’t the peak, we’re probably close.”
Intoxicating boom and terrifying bust.