Credit Writedowns
As far back as May, I had warned that commercial property was destined for a bust — collateral damage in the real economy. In particular, I mentioned the US commercial real estate (CRE) market as a particular problem for local and regional banks, which have large exposure to the CRE market. In May, I also mentioned incipient declines in the London commercial property market. However, Marshall Auerback recently alerted me to an article about the downturn in the Frankfurt property market, a casualty of downsizing in the global banking system. Unfortunately, this news provides another headwind for the ailing German economy.
Read a translated snippet from the article (original text in German).
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