There's been some sobering news on the economic front this week. Inflation is rising again, which means interest rates probably won't be dropping anytime soon. Larry Summers is warning that rates may actually increase in 2024.
That cracking sound you're hearing is the snapping of pencils that were counting on rate cuts later this year to restore some semblance of order to CRE balance sheets that have been upended by the rising cost of debt, shrinking margins and plunging property values.
The only ingredient missing from this bubbling stew of uncertainty is another banking crisis. We hate to tell you this, but conditions may be ripe for another fiscal debacle—in the same place where last year's regional bank scare unfolded.
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