With 23% of US Office Space Vacant, Some Landlords Are Defaulting on Mortgages
source link: https://it.slashdot.org/story/23/12/11/062216/with-23-of-us-office-space-vacant-some-landlords-are-defaulting-on-mortgages?sbsrc=md
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With 23% of US Office Space Vacant, Some Landlords Are Defaulting on Mortgages
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The New York Times reports:
Office landlords, hit hard by the work-from-home revolution, are resorting to a desperate measure in the real estate world: "handing back the keys." When this happens, the landlord stops paying the mortgage on the office building or declines to refinance it. The bank or investors who made the loan then repossess the building...
Since the pandemic began, office employees showed they could get their jobs done from home, and many have been reluctant to come back. And companies realized they could save a lot of money by renting less office space, making many office towers unprofitable for their owners and turning many business districts into ghost towns. About 23% of office space in the United States was vacant or available for sublet at the end of November, according to Avison Young, a real estate services firm, compared with 16% before the pandemic.
Defaulters include "some of the biggest names in commercial real estate, like Brookfield and Blackstone," according to the article, which argues that the phenomenon "reveals both the depth of the problems in the office market and the ability of big property companies to push much of the financial pain onto others — in this case, banks and other lenders."
By defaulting on their loans, the landlords avoid making any more payments (or incurring any more interest) — while saddling the banks with their depreciating building. "Big property companies can keep doing business after they default and are even considered savvy for jettisoning distressed buildings."
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We all know the risks are offloaded to the taxpayers and there will be bailouts (and bonuses!) for both lenders and office space companies.-
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The money printer will go Brrrr.
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Home Alone movie character Kevin's grocery tab in 1990: $19.83
In 2022: $44.40
In 2023: $72.28-
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In 2024 I'll choose between Biden and Trump and vote. The winner will likely be chosen based on votes in a state far away from me. My choice has exactly 0 impact on the future.
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Only 60% of registered voters actually voted in the last US Presidential election, but don't let numbers or facts get in the way of that defeatism you hold onto like your favorite bottle of bourbon.
I mean, it's not like the other 40% of America voting would sway an election that comes down to a purple swing every time...
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Don't believe the FUD. After short disruption, the plumbing will resume working under the new ownership that will work much harder to not repeat old management's mistakes.
The choices are not what revolving door central bankers want you to believe (i.e., systemic collapse). The choices are: short-term (at most a few years) disruption that will spill to the main street OR long-term stagnation without a chance to recovery that has a logical conclusion in Argentina-like scenario.
It is undeniable that the cur
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Same thing happens in every financial down turn.
During good times it's impossible to find office space, cost/soft sky rockets, land lords make out.
Then business cycles turn, companies go bankrupt, office space remains empty, land lords can take a loss to hold empty buildings or walk away. They often walk away. Win some, lose some.The banks then do what banks have always done: maintain empty buildings with a skeletal maintenance staff and sell them again in a few years when the economy recovers.
16% pre coved vs 23% post Covid vacancy rate isn't the end of the world for the banks or the land lords. Pre Covid the economy was humming along nicely.
Article is informative of current situation, I suppose, but it's not a big deal either way.
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The question is how much is "down turn" versus a work culture change that may be persistent.
Points against it not being due to a downturn is that the number of people employed in the US is higher than it has ever been. This puts aside all the debate about "percentage" of employment and simply you have more bodies working now than in 2019. If a downturn, you'd expect the vacancies to be associated with a drop in the number of employees to fill the space. The tech sector has had a few prominent layoffs, but what would be the "number of butts in seats" is in aggergate high.
On the other hand, white collar workers are frequently quite familiar with work from home and remote employees in the wake of the pandemic. While some companies have been trying to go back to in office, it's not all companies and most of them are going for a mix with hot desking allowing downsizing office space even while pulling people back to office. It's not crazy for all this to drive 7% vacancy on a longer term basis.
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The percentage may drop but new people keep getting made; all it takes is to pause building new offices for a while. Even if the raw population count stops rising, jobs keep moving from blue-collar to white-collar -- in our economy, even if they're socially useless (like sales, marketing, lawyers, or finance) -- thus, landlords will not suffer a loss.
The current screaming is only because executives are paid for this quarter's stock price rather than sustained profits.
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Things were already looking bad pre-covid:
https://therealdeal.com/new-yo... [therealdeal.com]
I had heard that there was a glut of commercial real-estate well before covid hit, and surprise surprise the problem did not go away. It only go worse. Blaming covid or work-from-home for this problem is not entirely accurate or honest.
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Good article. So it's a combination of over building, job hires slowing down, bad assumptions about future vacancy rates... and then Covid hit on top of a declining business cycle.
Yeah that's gunna sting.
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Have they not told the plebs to go back to work in an office?? Don't people know they are more productive in the offices of commercial real estate landlords??
Think of the poor landlord. So sad.
Wondering whether we'll end up not reproducing enough to necessitate high housing prices or if new home building will ever outpace demand.
Plan A; 1. Do whatever you can to buy a home. 2. Sell it for more or a lot more. 3. Repeat
This will always work and always scale until it doesn't. (BTW how do you spell "doe
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by Opportunist ( 166417 ) on Monday December 11, 2023 @08:17AM (#64072833)
Don't you DARE to bail them out with tax money!
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lol, of course they will. It's how this works. You already knew that.
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Sure, but I can still be pissed about it, can't I?
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Absolutely. Me too but I think I've reached a state of zen on this one because there's literally nothing we can do about it.
99% of politicians in both parties will vote for any tax payer funded bailout.
What I'd love to see that will never happen: a constitutional amendment that requires tax dollars are only spent on a limited subset of pre-approved categories. That list would not include saving companies that made poor or risky financial decisions. In fact, I'd have my amendment also have a black list of
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Just make billion dollar decisions like bailouts subject to a public vote. That should solve the issue pretty fucking quickly.
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LOL, you reaching a "state of zen".
"99% of politicians in both parties will vote for any tax payer funded bailout."
False. Perhaps you should learn about Two Santas, not that you don't already know, it's a political strategy consistent with your political narrative."...a limited subset of pre-approved categories."
Can't wait to hear what you'd "pre-approve"."That list would not include saving companies that made poor or risky financial decisions."
Unless the companies are vital to the national interest, a loo
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by backslashdot ( 95548 ) on Monday December 11, 2023 @08:20AM (#64072845)
Many landlords are eager to unleash hell on their renters when they don't pay. But when the shoe is on the other foot, they pass the buck to the banks. And you know who the bank sends the bill to, right?
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They repossess the landlord's property and sell it to cover their loss. If it doesn't, they can sue them as well.
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If it was up to me, the hitman.
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Many landlords are eager to unleash hell on their renters when they don't pay.
That is because they are trying to make payments and keep the building. Just like you would if it were your house.
But when the shoe is on the other foot, they pass the buck to the banks.
You can buy a house, stop paying, and they will take it back also! So if this is so awesome, you go do it...
The thing you seem to be missing here is the evil "landlords" you so despise, put down a deposit on that building initially. Then most o
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In an article on this I read a few months ago (yeah, it's hardly breaking news. Surprise!), it seems that the bulk of these loans are not only interest only until maturity, but non recourse!
What that means is that the bank can only take the property, and cannot sue for monetary damages.
(and, no, the borrower can't simply pocket the rent until the bank does this; the rents are "cash collateral" and keeping them instead of paying with them would be embezzlement, among other things.)
In some ways, issuing these loans was the same blind stampede as caused the mortgage lending crisis. The mortgage lending was based on the idiotic notion that "housing prices can not only only move up, but will continue doing so quickly, so there's no problem lending to a deadbeat with no money down, or even giving him 5%, even 25%, cash back". Here it was the belief that offices always must remain full forever, and that there's no risk of the building itself dropping in value.
Were the buildings still worth the price of the outstanding mortgages, the borrowers would simply sell and get at least a pittance back. Or, the bank could sell, possibly giving any change to the borrower.
But that is apparently not the case.
hawk, esq.
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Where I am, commercial landlords for many decades "raped" their small business tenants. This started in the 70s and it is at the point were the business district has hallowed out. 50/60 years ago, it was thriving. It is at the point if you own a business, you cannot rent but need to own the building you are in. So they get what the deserve.
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Indeed. My wife used to go to a shop where the lady who ran it taught "how to make dolls" of various types. Landlord raised her rent..a lot. She left. The store has not had a tenant since. Wasn't he smart? This lady's business had been there for a long time, and rent had risen over time -- but suddenly there was a >100% rise. Ha!
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Socialize the risk, privatize the profits, it's the American way.
Normal people do that and they'll face the bank coming after them until they finish a bankruptcy. -
All these people probably wondered why the money was coming so easily when times were good because they didn't understand what bad times would mean. And now they blame leaders for not holding back the world from having bad times.
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Yet there are still companies building office parks because they are incentivized to do so by the tax laws and by REITs. REIT investors are getting hosed right now because their assets are becoming worthless. It's a vicious circle.
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Some people don't understand that a market like this is a shared risk among all participants. Lenders, owners, managers... when the value of a revenue stream goes south, they all share the risk, and they need to re-evaluate the common burden. The mortgage is a part of that. Maybe the owners/managers truly default, maybe they use it as a stepping stone to negotiate it downwards or change the terms.
This is different than personally owning a house. It's an investment, and all parties know it.
Not to side with D
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Oh don't you worry, it's not any risk to them at all. If their gamble does great, they make millions. If it fails, the taxpayer will bail them out.
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guess they expected a tax payer funded bailout.
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Here is a chart of actual vacancy rates in US, which is a lot more useful than this article.
https://www.statista.com/stati... [statista.com]-
Do you happen to have a source that doesn't try to make me sign up so I can see something but a bunch of bars without labels?
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One bourbon, one jack, one beer
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by geekmux ( 1040042 ) on Monday December 11, 2023 @07:43AM (#64072753)
Hopefully the property owners and banks will remember these defaulters when they come crawling back looking for office space.....
Real cute considering who those banks were crawling to in 2008 to get bailed out, and will likely do it again.
Commercial property values have both a global pandemic and common sense regarding remote work technology that's literally been around for decades to blame. What was (or will be) the banker's excuse again for saddling taxpayers with their fuckery?
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A quick google suggests that the value of the commercial real-estate portfolio in the USA was about $16 trillion in 2018. TFA suggests that the vacancy rate is now 23%, or about $3.7 trillion worth of empty property.
Gauging how much of that is currently financed by mortgage debt, and how much of that debt might be defaulted on, and what the value of the resulting repossession will be to a bank, are all naturally very difficult. But that $3.7 trillion represents about a quarter of all banking assets in the USA. It's not going to take a very high repossession rate for some banks to get into very serious trouble. The repossession value is what's really worrying - the banks will have made these loans based on a set of assumptions about the commercial property sector and those assumptions are proving very wrong. The buildings could turn out to be not only worthless but a liability. In normal times, what would happen is that a bank repossesses the building and drops the rent to the point where it is occupied again; the resulting rent tells you what the real value of the building is. But a company choosing between "some rent" and "no rent" is never going to be persuaded by dropping the price so these vacancy rates might be unavoidable no matter what the rent drops to. That spells a glut in commercial real estate which means the problems for landlords are only going to grow - and they will continue to hand the problems on to banks.
This could all get rather scary.-
Watch for MORE calls to "return to the office" to work in 3.....2......1.......
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And watch for me to tell them to suck my gonads. I think it's finally dawning on a lot of employers that things have changed, and changed permanently.
I get calls from recruiters almost every day. The first thing I ask them is, "Is this remote or onsite?" and if the next words out of their mouth aren't "Remote..." then I just hang up. No niceties, no polite explanations, I just hang up. Anything more involved would just be wasting time for both of us.
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It probably will get scary. We're living in a increasingly connected world where neglects, laziness and greed of the past are increasingly piling up. It's doesn't look like politicians seem to understand that natural events (including people psychology) mostly do not happen on a linear scale and tipping points into cascades are rather the norm than the exception.
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Politicians don't even seem to understand that if they kick themselves in the nards, again, that it will hurt, again.
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It was 16% before, now it's 23%. If a change of 7% puts landlords on their knees, they didn't have a good business plan to start with.
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Well the "real value" is somewhere between depreciation and paid off and what the market will pay. Anything less means tearing down the building and paying taxes on the land. As for usage, buildings have more usage than as containers for workers.
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A couple things are missing from that analysis: the incremental vacancy is closer to $2.4T for starters, and the loans should have had some significant equity and collateral in pre-pandemic valuation. That should be at a minimum the first half of the bad debt, so the banks are down closer to $1-1.2B. What makes the properties under water is the increased interest rates first and the erosion of equity second. Since the real-estate companies generally finance for cash flow rather than equity growth, they don
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Commercial property owners don't 'put down' 50% of property's value when buying it - just like homeowners don't. Sure, some do, but the vast, vast majority of investors put down much less, relying on the appraised value to act as security for the loan.
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oh no
any way...-
Cool shirts, I may snag one.
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There are three parties: Tenant, Landlord, and Lender.
The Tenant can break a lease or just not renew a lease, costing the Landlord expected rent payments.
With a glut of available (vacant) properties, landlords will face a cash crunch, their properties failing to raise enough money to meet the Landlord's obligations (loan/mortgage payments).
When the Lenders stop making loan payments, the Landlords will wind up giving lenders the one thing they don't want, an inventory of old, vacant office space that is rapi
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Yes, change is frightening. But the big picture here is ultimately a good one. Our resources were clearly mis-allocated, and the tipping point was reached.
So, we are going through the re-allocation phase right now. Economic resources are shuffling a bit away from office space and (hopefully) a bit towards affordable housing. That will result in a healthier balance with better resource utilization overall.
There will be pain in the interim....there are people who were profiting from the misallocation who will now resist the change as much as possible, and push their pain on to others as much as possible, and of course that is bad. Also it seems the builders have zero interest in making affordable housing and ONLY want to make high-end luxury housing, which most can't afford, which will result in a dragging-on of the pain as those buildings default again in order to pull the prices down to the correct level (and, at least in some cases, tear down and start over with something more affordable in mind).
But these pains are temporary. The re-allocation will happen even if greed and an inability to see the big picture slows it down.
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The thing is, defaulting on a loan is perfectly legal, acceptable and road-worthy for the landlords. They're making a calculated decision here - I'll bet they're even inviting the last tenant is $shithole building to move to $nice_building up the street for the same rent, just so they can offload the dump.
As you say though, leaving the bank with the mess to clean up will eventually leave that mess to tax payers. Its almost as if the banks have been a bit reckless with your money from last time around, isn't
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The defaulters are victims of a shift in one sector of the property market. To refuse to lend to them in a different sector is to waste the borrowers knowledge of that different sector, and to prevent economic growth because the investment didn't happen.
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Hopefully the property owners and banks will remember these defaulters when they come crawling back looking for office space...
The defaulters are victims of a shift in one sector of the property market. To refuse to lend to them in a different sector is to waste the borrowers knowledge of that different sector, and to prevent economic growth because the investment didn't happen.
Try making that argument with a straight face to someone who lost a home circa 2008 and had their credit destroyed for the next
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The irony is, a lot of this office space will end up being turned into overpriced apartments.
Working from home is here to stay, despite how much "office landlords" don't want it to.-
This is the solution. Office space is underpriced. Housing is overpriced. So there's a lot of money to be made converting the former into the latter.
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Not if corporations stuck with the office space are the same ones profiting from the artificial scarcity of housing. Real Estate investors love the double dip caused by office commuting, work at home is against their interests.
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Not if corporations stuck with the office space are the same ones profiting from the artificial scarcity of housing.
Markets don't work that way. There are dozens of construction companies in my city and hundreds of general contractors.
They can make a big profit by doing a conversion but the scarcity reduction from their one conversion will have a negligible effect on pricing.
Your conspiracy theory relies on collusion, which is common with two or three competitors, possible with a few more, but unworkable with dozens or hundreds.
Housing prices are not high because construction companies collude, but because NIMBY voters support low/no-growth policies and strict zoning laws.
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I don't know anyone who strait up walked away and did the key's left on the counter thing, I am sure if you did that it probably left your credit in a pretty bad way for a long time.
I know a couple people who told me they negotiated short sales, and they were both out the apartments they rented and back into similarly palatial houses just three and four years later. I don't know maybe they got crappy rates, but given they were also in the same jobs I doubt they could have afforded the monthlies if that was
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They should talk to the deadbeats who took out NINJA loans, then failed to make a payment because, whaddya know - no job, source of income, or any assets to speak of. Multiply that by tens of thousands.
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"The defaulters are victims of a shift in one sector of the property market."
No. They are losers of that shift.
"To refuse to lend to them in a different sector is to waste the borrowers knowledge of that different sector, and to prevent economic growth because the investment didn't happen."
No. Refusing to lend to those that default on loans is a consequence, just as imprisoning a murderer is not a waste of a the murderer's ability to kill people.
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Bankruptcy is a common business strategy to shed bad debt.
No rational company should burn shareholder capital out of some misplaced sense of "honor".
Don't confuse hardnosed capitalism with missionary work.
Office space is a buyer's market. The banks will jump on a chance to sell.
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"No rational company should burn shareholder capital out of some misplaced sense of "honor".
Don't confuse hardnosed capitalism with missionary work."
No, what you mean is "don't confuse hardnosed capitalism with missionary work" when it benefits you but do confuse it otherwise. Any "sense of honor", that is "business ethics", is a weakness to people like you, the world is merely a resource for you to exploit.
Also, it should be noted that banks are "rational companies" too, and zero-consequence bankruptcy en
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They will because computers rarely forget records but there are some things worth remembering from the perspective of guessing at future lender behavior towards them.
These are commercial loans, they were not made on the basis of avoiding some some HUD law suit. They were done based on sound underwriting and reasonable appraisals for the most post.
Even if the long term trends for remote work were predictable the pandemic and its acceleration and subsequent nascent reversal of those trends was not.
Similarly the intrest rate risk was also not really predictable, well ok it was but people had been predicting rate hikes for a full decade and they never materialized, at some point it was reasonable for people to allow that near zero and negative central bank rates and the trickle down of that to commercial lending rates being low single digit percentages was 'just how things work now'
The investor took a risk on the property appreciation and revenues being greater than the maintenance costs and taxes, with all the built in assumptions about cash flows. The creditors looked at it and took the risk on extending them credit to do that. Risk is what you get paid for, you get paid because some times you lose. That does not mean you don't do it again and it does not mean mistakes were made necessarily. From the lenders perspective here, they are losing money because the investors were wrong about things they were themselves also wrong about.
That is pretty different than say if CEO and boards of theses real-estate firms were all defaulting because they were buster doing coke off of some prostitutes paid form the company bank account - that would make them 'personally unreliable' that is the kind of thing that would be 'remembered' in a future lending decision, that isn't this though.
So my guess is when these firms come looking for credit, that request will simply be evaluated in the context of assets, other liabilities, and income prospects; as if all this never happened, because "you didn't have a plan for a once in a century event, and it dramatic shift in long term trends" isnt much of data-point as to evaluating the success of future business ventures.
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TBH, this feels like the old "it's real estate, real estate never goes down" . We've all heard that before.
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the reason this is happening is a) work from home didn't go away, there were plenty of employees too valuable to force back into the office to maintain property values and b) as the boomers retire a lot of their jobs are being offshored and offshore don't need office space.
It's a permanent reduction in the demand for office space. -
Meanwhile, increasing numbers of people are living in tents on the sidewalks of empty buildings. Eventually someone will clue in.
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I doubt things will ever go back to the way they were. My company (350K people) has closed almost all of its physical offices and we, the employees, were only to happy to go to 100% WFH.
The chances of them deciding to reverse course and open new offices are trillions to 1. It's just not going to happen. They're saving truckloads of money now that all the leases have ended and everyone is working from home, and we love it.
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Actually, all money is essentially debt so what we have is a lot of debt floating around. As far as I understand it, that tends to destabilise economies at the macroeconomic level. The primary purpose of taxation, at the national level, is to limit that risk, i.e. take money/debt out of the economy. When the economy may benefit from greater liquidity, e.g. to increase investment & other economic activity, the central bank can issue more money. This is pretty much the opposite to what most Americans are told about macroeconomics, especially by "fiscal conservatives" who get all excited about debt ceilings & use it as leverage to cut public programs. The biggest risk to any economy is tax cuts for the rich; it destabilises the economy & presents existential risks to democracy too, as we're witnessing at the moment (There's very high inequality & huge surpluses of money held by a tiny few).
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The fact debt exists is proof there's plenty of money needing a place to park in exchange for a decent return on interest.
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You really didn't understand what I wrote, did you?
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There's nothing stopping you from writing a check payable to the US Treasury and mailing it if you'd like to pay more taxes. They will gladly cash it. Why won't you?
Because individual action does not cure systemic problems.
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While I am by no means making the argument that the rich don't weasel their way out of paying taxes, I gotta reiterate that many people calling for "taxing the rich" have a very underdeveloped understanding of how being rich actually works.
If you see a net worth in the news and think "Gee, the government should get itself a cut of that", then that would be the equivalent of the government taxing you on income you theoretically could have if you rented your home out instead of living in it (as Switzerland is
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That reminds me, did he ever build that wall and make Mexico pay for it?
And do we still need ID to buy bread, like Trump has said several times?
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Yeah, that's not how it works. Financial context makes a difference.
The same amount of money lets you be 'rich as fuck' in Vietnam or India and simultaneously 'poor as shit' in the US.
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Have you heard about the Panama Papers [wikipedia.org]? Did Panama ever get rich? Seriously, what did Panama get out of all those 'transactions'?
There's even a movie with Meryl Streep [wikipedia.org] about the subject.
Since then Joe Biden signed up for a 15% minimum corporate tax globally [ibfd.org], praise be.
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Found the globalist.
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Would you mind clarifying your statement?
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He means kill the Jew.
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Thank you for taking the time to clarify something for me. Still, I don't get it. I am not Jewish and I am not a wealthy person by anyone's measure. The fact of the matter is I pay much more in tax as a measure of my proportional income than the wealthiest among us.
p.s. racism sucks.
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Are you saying Warren Buffet isn't telling the truth [youtube.com]? He's like a top earner.
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Yes. Panama banks were full of money that fled elsewhere.
Yes. Panama has one of the world's highest economic growth rates.
Many other countries didn't sign up.
Also, corporate tax isn't the same as "rich people tax". Most corporate profits and capital gains flow into middle-class pension funds.
Rich people are more likely to own S-Corps and LLCs. Guess what? Those aren't affected by Joe's 15% global minimum.
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Rich people are more likely to own S-Corps and LLCs.
Err, you don't have to be rich to incorporate and own your own S-Corp or LLC.
I've had a S-Corp for many many years and do my contracting through that, and other work on the side.
It's a great thing to have if you contract or want to do your own private business through.
I saved a TON on employment taxes with the S-Corp.
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Now, ask yourself, where does the money come from that the corporation uses to pay taxes? Think about it while you eat that $16 BigMac.
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Since the corporation only pays taxes on net profits, higher taxes are actually incentives to put money back into the company instead of shareholders. So your argument isn't really valid.
Surely you don't think companies pay based on gross? But it's a neat way to trick people who don't think it through.
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Sounds like someone doesn't like the squeezing. No better argument for squeezing harder.
It should be noted that this poster has previously commented that he has served on multiple boards of directors of corporations. He is literally one that would be squeezed and his response is to threaten. Shanghai Bill is the enemy of a fair and just tax system, but that should surprise no one.
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>> Rich money is mobile money. The harder you squeeze, the more slips through your fingers.
That is a myth. Citation needed.-
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The State of New Jersey had to redo the state budget when just one high-tax paying resident moved to Florida.
David Tepper - https://www.forbes.com/sites/t... [forbes.com]
In NYC, the top 1% of tax filers contribute 50% of the tax revenue collected, Gov Cuomo 'begged' the rich to return to NYC to help save the city:
https://nypost.com/2020/08/05/... [nypost.com]
A quick visit to Google will turn up countless stories about people fleeing California and businesses relocating out of high-tax states.
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Remember that most bailouts make a profit
Remember that it's not the taxpayer's obligation to bail out failing companies.
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(Too Big Too Fail) "Since when?"
(Legal Precedent) "We must respect history..."
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Has that guy never heard of inflation?
For example, the Citigroup bailout was for $306B in Nov 2008, and that article said it netted $13.4B in profit -- as it turned out, by somewhere between December 2010 and Feb 2013. The producer price indexes for Nov 2008 and Dec 2010 were 172.1 and 189.7, which means the $306B bailout cost in 2008 was worth $337B in 2010. The $13.4B n nominal profit doesn't make up for the $31B in losses to inflation.
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The slab of cash that bailed out Citibank would either not have existed or been borrowed by the Treasury at a very low rate of interest. It's still a profit even if it's only better than than the alternative. And the consequences of the collapse of a 'too big to fail' institution would have been a horrendous loss to the US taxpayer. So the point is that the bailouts weren't anything like as expensive as they seemed at the time.
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For your first case, it would have been more profitable to just print the money and deposit it into the federal government's general accounts.
For your second case, we should add those interest costs -- and the present-value discount for the future repayment -- to the inflation costs, making it even more costly.
If you want to defend the bailouts as justified because these companies are too big to fail, do that. But don't try to pour sugar on that sandwich and call it tasty by claiming that ackchyually they
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The remarkable feature of most of the bail outs in 2008 was that they cost the taxpayer pretty much nothing. This means that the hyper-ventilation at the time at the apparently large figures being thrown about was a mistake. The probability that that will happen again is the lesson we need to hear; perhaps overstating the 'profit' earned is inaccurate, but it clarifies the reality.
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$306 Nov 2008 is $315.73 Dec 2010. [bls.gov]
only a 9.73 difference, Not 31-
We're taking businesses, so PPI is the right metric to use, not CPI.
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Greed abusing Greed's playbook. Now who could have seen that coming again and again and again.
But hey, let's point some fingers over here and over there, because stupid people.
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The next 10 years saw minimal inflation, which is, of course an INCREASE in prices, not things being free.
You appear to be focused on the recent surge in inflation.
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If government buildings have lots of extra space then they just need to hire more people.
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They need to sell off that unproductive asset to one of their friends and lease it back from them.
And then hire more people.
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Well if that "Stable Genius" had taken all the money his farther gave him and put it in either a Bank or invested it via funds run by reputable financial institutions, he would have been far richer than he is now. Plus many of his legal issues may not exist.
Instead he went on to become a real estate con man and ended up loosing lots of money from his real estate investments. Plus at least 1 bankruptcy (Atlantic City) I know of.
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