In October 2021 the bond market was pricing the Fed to hike by 30 bps and inflation to be 2% in 2022
The Fed hiked by 400+ bps and inflation turned out to be ~8%
The bond market didn’t predict inflation & the hiking cycle
What makes you sure now it knows something we don’t?
Over the next 5 years, more than $2.5 trillion in commercial real estate debt will mature.
This is by far more than any 5 year period in history.
Meanwhile, rates have more than doubled and commercial real estate is only 60-70% occupied.
Refinancing these loans is going to be incredibly expensive and likely lead to the next major crisis.
The worst part?
70% of commercial real estate loans are owned by small banks.
Rapidly rising rates are teaching everyone a valuable lesson.
There's no such thing as "free" money.
Things you control:
Your effort. Your beliefs. Your actions. Your attitude. Your integrity. Your thoughts. The food you eat. How kind you are. How reflective you are. The type of friend you are. The information you consume. The people you surround yourself with.