McKae Properties Real Estate Market Commentary

  Startup bubble fueled by Fed’s cheap money policy finally burst in 2023 PUBLISHED THU, DEC 28 2023 9:00 AM  After years of record venture investments tied to low interest rates, cheap money has stopped flowing in startup land, leading to high-profile failures.WeWork and Bird declared bankruptcy in 2023, while pandemic plays like Hopin and Clubhouse faded into oblivion.“Prediction: 2024 is the year we finally bury the class of ’21 ZIRP ‘unicorns’ and start talking about a new crop of great companies,” Jeff Richards, a partner at venture firm GGV, wrote in a post on X. Easy Money created more risk than the inexperience entrepreneur.  The plan would to go back for more money when problems erupted.  Then came higher interest rates.  Failures, bankruptcies followed with empty offices and work from home.  Nothing new here! This year, it all unwound. With the Fed  lifting its benchmark rate  to the highest in 22 years and persistent inflation leading consumers to pull back and businesses to

  "Much Ado About Nothing" is the title of a well-known play by William Shakespeare (1599).  The phrase was assimilated into the English language and used when someone is overreacting and makes a big deal or fuss over something unimportant.   The  Fed voted last week to hold rates steady once again, and its updated projections showed an expectation of three rate cuts in 2024.  That caused a rally in stocks and bonds, with the Dow Jones Industrial Average jumping to a   record high . “It’s not what you say, or what the chair says. It’s what did they hear, and what did they want to hear,” said Chicago Fed President Austan Goolsbee said on CNBC’s “Squawk Box.” “I was confused a bit — was the market just imputing, here’s what we want them to be saying?” “The market expectation of the number of rate cuts is greater than what the SEP projection is,” Goolsbee said. Three Rate Cuts, to me, means that the FED is opening a safety valve in the event of a crisis in which the FED must ste

 I love that phrase.  Its origination is a mystery to me, it could have come from something Biblical.  Throughout my career there are numerous times when chaos was created, that GOD was laughing at the plans of Man. Ladies, don't get offended.  Biblical references all reference Man not both sexes ( the main reason I think this is a Biblical Quote).  In fact, I doubt if chaos would have been created if Woman Planned.    The past plans of Man of lower interest rates being a new normal has created chaos for those both of minimal net worth and experience to those of substantive net worth and education and experience to fall into a crisis of credit and net worth devaluation.  The Trillion or so dollars in Office Building Debt that is supposed to come due in February 2024 is one example of the plans of Man that go awry.  The expectation that both office buildings would remain full and rising rates were guaranteed were matched with add on loans that were short in duration or worst variabl