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Monday, May 25, 2020

The US debt market is going to implode!

http://sg-stock.blogspot.com/2020/05/us-cmbs-is-in-precarious-situation-now_22.html

As stated previously, the CMBS market is in a precarious situation.

The MBS market is also in the same situation as CMBS because the existing home sales figure is also falling.


Recently, the car rental giant, Hertz, has filed for bankruptcy.

https://edition.cnn.com/2020/05/22/business/hertz-bankruptcy/index.html

This car rental firm bankruptcy has also brought out the car debt market issue into the open.  The US used car prices are falling and many car derivative products (car debts) created by the banks and financial firms are also in a big trouble as there will be a severe mark down in the used car values.

When the US debt market starts to implode, the US economy will explode because its economic growth is based on debts.  An implosion will cause a big explosion!

Let's watch how this will pan out.

2 comments:

Eric Ho said...

Let's do a summary about the US debts that are in troubles or going into troubles.

1. oil debts
2. cmbs
3. mbs
4. car debts

We have to monitor the US debt markets to gauge the US economic health.

Eric Ho said...

https://finance.yahoo.com/news/risk-clo-losses-keeps-japan-200000130.html

Japan is cutting back on its purchases of clo which means that debt issuers are finding it harder to sell their debts which were repackaged into debt derivatives.