This chapter delves into the potential consequences of significant rate cuts by the Fed on distressed office assets, cautioning against overly aggressive cuts to zero or 1% due to historical associations with major financial crises. The speaker advocates for a more moderate interest rate approach around the three to three and a half percent range to maintain stability and avoid exacerbating underlying economic issues.
Don't expect interest rates to drop back to zero. But your floating-rate loan may be a bit less painful by year's end. The Real Deal's Deconstruct chatted with BGO's Chief Economist Ryan Severino about when rate cuts will come, the data that shows a cooling economy and what risks the Federal Reserve runs if it cuts too little, too late.