I wish The Federal Reserve had created only tiny bubbles. But after Bernanke/Yellen’s zero interest rate policies (ZIRP) and Quantitative Sleazing (QE) for too long, we have a monstrous asset bubble in commercial real estate … that is starting to unravel as The Fed raises rates and shrinks their balance sheet.
The NCREIF commercial real estate indices are beginning to decline as The Federal Reserve has finally started to raise interest rates and shrinking their balance sheet after being TLFTL (too low for too long).
Hotel (blue) and retail (orange) both got crush with the Covid shutdowns. But while the hotel property index continues to climb, retail properties are declining again.
Here is a photo of former Fed Chair and current US Treasury Secretary Janet “Bubbles” Yellen.