by Greg Hunter

It was a direct hit because in March, Silicon Valley Bank (SVB) tanked, and the FDIC and the U.S. Treasury were forced to basically back-stop the entire banking system.  The financial problems are far from over as Rubino explains,

"Basically, interest rates have been artificially low for a decade...

In that time, crazy numbers of office buildings went up and were financed at really low rates... Now, office vacancy rates are spiking, which means office building are not profitable anymore.  The debts they have at 2% to 3% now have to be rolled over at 5%, 6% or 7%.  This means an already unprofitable office building is going to be even more unprofitable because of rising interest rates. Now, they want to sell this office space, and the price cuts that have to be done to get a deal done is 30% to 50%... Some are down by 80%...

Local and regional banks already had their troubles last month but are going to have bigger troubles when all these building turn out to be not worth nearly as much as we thought they were.  This paper is in pension funds... they are going to go into crisis. 

So, real estate is liable to be the catalyst in crisis in several other sectors... The government is going to have to let it burn and have a 1930's style depression, or bail out everybody in sight... at the cost of rising inflation and the dollar tanking."

Rubino says, "There is no fix..."