Psst! Timmy.I think we have a problem

This monster on the left is supposed to be a hydra headed monster, a metaphor for the dangerous silliness going on in DC. You thought the banks were insolvent because the real estate market tanked because immigrant strawberry pickers were falling behind on their San Joaquin Valley mcmansions after their ARMs reset. Well actually it’s a little more complicated than that. George Soros the other day dropped a bomb predicting a big drop in commercial real estate in the US but actually ComRE has been imploding elsewhere. One of the German Government’s early bailouts was a real estate firm. So I decided to try to find out the percentages of loan composition on these banks balance sheets and this is what I found:
Residential mortgages account for only about one quarter off their loan portfolio(26%).
Commercial,Industrial, non farm nonresidential and construction loans amount to 40%. Public anger is growing to more bank bailouts and a drop in the value of banks commercial loan portfolios could trigger the next grand mal seizure in the banks not to mention in any derivatives or SIVs tied to commercial real estate. Hello AIG! Don’t Ask! Meanwhile over in Europe ahead of the G20 meeting in London, the President of the EU, Mirek Topolanek yesterday said the Obama economic policies are putting it on “The Road to Hell.” My sentiment exactly.


Published by Rendezvous Mountain Farm

I was born in Cascade county Montana and raised in a dozen Air Force SAC bases. I attended Holy Cross,West Point and UNC in Chapel Hill(MD"71). Army doc in the last years of the Viet Nam fiasco. My wife and I live in a log cabin I built from standing dead lodgepole trees we cut from Shadow Mountain and regional local timber in 1976 . I've done a dozen different jobs including construction, boat building,magazine writing and commercial fishing and retired from the Emergency and Operating Room in 2004. We manage a small diversified organic farm including leased land which totals about 40 acres in the Jackson Hole valley. We raise a variety of livestock which includes some heritage breeds of animals and poultry. We grow most of our food and forage. Our land is irrigated from Granite Creek and the Snake River and we raise and bale our own organic hay. We supplement with food collected from Jackson Hole Food rescue which is mostly dairy, bread and past date vegetables and food from the grocery stores and restaurants.

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