Well, the FED is entangled into its own net of unconventional monetary tools and doesn’t know how or dare to get out of it. They know markets need all these liquidity to keep current valuations (equities, bonds, credit, alternative like PE, PC and real estate) and they don’t want to be blamed for doing the right thing. The issue is that protracting the current situation makes the regional banks financial position even worse and a further collapse in CRE more likely. It will not be fun.
Well, the FED is entangled into its own net of unconventional monetary tools and doesn’t know how or dare to get out of it. They know markets need all these liquidity to keep current valuations (equities, bonds, credit, alternative like PE, PC and real estate) and they don’t want to be blamed for doing the right thing. The issue is that protracting the current situation makes the regional banks financial position even worse and a further collapse in CRE more likely. It will not be fun.