April 9, 2020: Our economy is a sinking ship and The Fed is trying desperately to plug all the holes. Holes are appearing daily, no HOURLY. I’m going to go over just a few of the many clues we’ve seen in the news that shows where the ship is leaking.
West Michigan Market Update
As of April 8th 2020, we as a company have seen a 10% decrease in rents collected across all properties managed compared to pre-COVID months. A New York Times article dated 4/8/2020 reported 31% Can’t Pay the Rent: ‘It’s Only Going to Get Worse’.
This will most certainly be a developing story as we head into the next several months.
- Residential Mortgage Servicer request Bailouts
- Commercial Real Estate looks bleak
- Unemployment – 16+ million and growing
- Follow the $$
- $500bn City, State and municipal Bailouts
- Holes keep appearing and things are just starting
- Even if they (the Fed) can try to plug them with new money, there will be many unintended consequences.
- Residential Real Estate is seeking bailouts.
- Commercial Real Estate has a dismal present outlook.
- Unemployment is rising.
- Investment firms are ready to deploy capital when prices tank.
- Cities and States need $$.
- Stockpile your own cash reserve and be ready to act when opportunity presents itself
This post is meant to bring to light the issues that are being created. This isn’t going to be fixed overnight. It’s important to stay vigilant. Pay close attention to the FACTS and you will find these clues yourself. Last week, I talked about TRUTH and LIES about the Financial Crisis. This week should help you find more of the TRUTHS.
- Mortgage firms teeter near crisis that regulators saw coming (My San Antonio)
- Coronavirus effect: Bankruptcies won’t save retail this time (CNBC)
- Fed Expands Corporate-Debt Backstops, Unveils New Programs to Aid States, Cities and Small Businesses (WSJ)
- Real-Estate Investors Eye Potential Bonanza in Distressed Sales (WSJ)