Investors, brace yourselves. Databrick’s announcement of a steep drop in GPU prices is echoing through the market, and UBS adds to the caution with reports of NVIDIA GPU lead times substantially reducing. Despite these ominous signals, UBS has raised its price target. The media is catching up to a concerning practice by Nvidia – boosting sales through shell corporations, a strategy eerily reminiscent of the Dot-Com bubble.
Lawrence H. Summers, former U.S. Treasury Secretary, has given a 15% chance of the next move being an upward shift in interest rates. The Federal Reserve faces delicate decisions ahead. In New York City’s commercial real estate (CRE) sector, maturing debt for rent-stabilized buildings poses a challenge. As loans refinance and rent increases lag behind operating expenses, massive haircuts on new loans become inevitable.
A notable example is a $149.2 million CMBS loan for a 665,592-square-foot office property in Jericho, New York, which has missed its January 2024 maturity date, now in the hands of a special servicer. Real estate magnate Barry Sternlicht predicts a $1 trillion meltdown in the office sector.
Automotive distress adds to the economic puzzle, with new car inventory surging by 194% in just 30 months. The yield curve steepens at an alarming pace, signaling a potential full-blown recession by year-end. Bankruptcy filings are accelerating, raising concerns that a breaking point is on the horizon.
Investors, be vigilant as these red flags paint a concerning picture for the stock market’s stability.
Sources:
Exactly what TSMC said they are doing for the 2nd half of 2024 to increase Nvidia production. $nvda pic.twitter.com/NNkUGV13cK
— Don Merrifield Jr. 🇨🇦🇺🇦 (@donmerrifieldjr) February 16, 2024
Mainstream media is onto Nvidia's round tripping cash finally… 6 months late.
They've been boosting their sales by providing liquidity to shell corporations, similar to vendor financing during the Dot-Com bubble.pic.twitter.com/AhmbNJvJU3 t.co/l4NefeNtc2
— Financelot (@FinanceLancelot) February 16, 2024
A lurking issue within NYC CRE is maturing debt of rent stabilized buildings from pre 2019.
As existing 5+ year loans refi, new loans will get massive haircuts as rent increases haven’t kept up with operating expenses at all post law changes.
Pay up or hand back keys to lender
— NYRE Dude (@NYRE_Dude) February 16, 2024
#TreppWire Trading Alert🚨
A $149.2 million #CMBS loan has missed its January 2024 maturity date and is now in the hands of the special servicer. The collateral is a 665,592-square-foot #office property in Jericho, New York.
See more via #Trepp: t.co/K8t5cMAAx9 pic.twitter.com/TsJhK1XBr0
— Trepp (@TreppWire) February 16, 2024
New car inventory has increased 194% in 30 months
October 2021: 885k new cars in inventory
February 2024: 2.61m new cars in inventory pic.twitter.com/OCahvVuq35
— Zach Shefska (@shefska) February 16, 2024
🟥WARNING🟥
The yield curve is steepening rapidly.
We should face a full-blown recession by the end of this year. pic.twitter.com/DDEi4jcuFJ
— HZ (@MFHoz) February 16, 2024
The office meltdown will result in $1 trillion of losses, real estate billionaire Barry Sternlicht has said, per BI.
— unusual_whales (@unusual_whales) February 16, 2024
Bankruptcy filings are aggressively moving higher
At this rate, something is bound to break pic.twitter.com/YwznWJlUuf
— Game of Trades (@GameofTrades_) February 16, 2024