What I'm Reading Scaling Back: As prices climb on restaurant menus and grocery-store shelves, some packaged-food makers see more Americans making meals at home to save money, while restaurant operators are changing their offerings to cope with increasingly price conscious consumers. Wall Street Journal Taking a Toll: Higher mortgage rates...
June 16th – The Hangover
What I'm Reading The Hangover: California has a near-$100 billion budget surplus thanks to booming asset prices leading to a capital gains windfall. As usual, politicians in Sacramento are fighting over how to spend the money quickly by establishing new social programs or funding large one-time expenditures. However, with asset...
April 5th – Backslide
What I'm Reading Backslide: Troubled real estate loans for the likes of retail and offices that saw payments get back on track after the 2020 crash are re-defaulting -- signaling more pain for commercial mortgage-bond investors. This is occurring as commercial landlords who lost tenants during Covid are still having...
January 4th – End of the Line
What I'm Reading Tick Tock: The window for banks to use troubled debt restructuring (TDR) is coming to an end. TDRs have been a way for lenders to modify a loan’s terms, because of a borrower’s financial or legal difficulties, and account for an impairment of value. Under the initial...
December 17th – Spreading Out
What I'm Reading Spreading Out: There is building anecdotal evidence that a substantial portion of surging demand for housing is due to the US undergoing another episode of average household sizes shrinking, much as it did in the 1970s. Calculated Risk Whack a Mole: People are ricocheting between skyrocketing rents...
December 15th – Delay Tactics
What I'm Reading Delay Tactics: Planning departments in California cities are going to great effort to try to comply with California's new housing mandates. Unions and environmental groups are using CEQA to stifle those efforts. Two stalled projects in my hometown of Newport Beach illustrate the problem. OC Register Latest...
November 8th – The Weakest Link
What I'm Reading The Weakest Link: Environmental and anti-business regulations make California the absolute worst possible place to be the US focal point for supply chain issues. Wall Street Journal Narrative Violation: Last week's taper announcement was met by rates falling substantially at the long end of the yield curve. ...
September 10th – Putting This to Bed
What I'm Reading Putting This to Bed: In total, 1 million forbearance plans will expire between now and the end of 2021. There is a vocal contingent that has been predicting a wave of foreclosures for months. However, I am virtually certain that this won't happen as almost all of...
September 2nd – Exodus
What I'm Reading Exodus: More California companies have already moved their headquarters out of the state this year than in all of 2020. While businesses often attribute their California exit to regulations like high taxes and increasing utility costs, other reasons may sound similar to individuals leaving the state, such...
July 1st – Hiding in Plain Sight
What I'm Reading Hiding in Plain Sight: It's well known that US infrastructure from roads, to bridges, to tunnels is falling apart. The tragic Florida condo collapse this week highlights another type of private infrastructure disaster that may be much more widespread than we currently think. Justin Gillis highlighted the...