WSJ "Commercial Space Starts to Wobble" 9/21 p. C1, C9.
"US banks might face more headaches over the $1.4 trillion in commercial real-estate loans still on their books"
"'Many small and some medium-size institutions remain unprepared for the harsh realities ahead,' given their limited captial to deal with billions in troubled mortgages, the Deutsch Ban reprot warns"
Majia here: The problem of leverage and the lack of collateral continue to haunt banks and the entire financial sector. Commercial real-estate was one big bubble that was part of the larger policy of extend-and-pretend promoted by the last 2 presidential administrations.
Bad loans that remain on books hurt lending today. Banks need to be forced to write-down unperforming loans...
Some background http://www.washingtonsblog.com/2011/08/by-choosing-the-big-banks-over-the-little-guy-the-government-is-dooming-both.html
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