How is Black-Rock inflating values in certain neighborhoods? Sure they are paying about the same price as the consumer, overall, because they can borrow money cheaper than we can. But the purchase price is higher, which increases values in those neighborhoods. Still don't see the problem?
If you want to live close to those schools or close to your job you may not be able to buy a house, you must rent. Let's say you do buy a house, you will be paying quite a bit more in that neighborhood. But some articles state that Black-Rock didn't buy the houses, they bought a company who already had them in their portfolio, but did Black-Rock already have an ownership interest, or did they fund Partners of America before the purchase?
What they did say is that Black-Rock borrows their money from the Fed, which is way cheaper than what the average consumer can get. The lower cost of funds is their way of paying the same for the house as you do, but if their money is cheaper than yours and they take those savings to 'up' the price, paying more than 30% to 50% more for the house than you do, where does that leave the market, and you?
If you are looking to sell, they did you a favor, now you can take your inflated dollars and you can pay more for a house in another neighborhood, inflating values there. The Fed is total behind this behavior. Hell, they are funding it. Not directly, but indirectly. Think it's okay? I had four locals that qualified for a mortgage but sadly, there was nothing in their price range.
The Federal Reserve purchased billions of secularized mortgages from banks. What made them 'distressed assets'? Forbearance. They were undoubtedly purchased at a huge discount. The Federal Reserve Bank is part of the Federal Reserve Act, its purpose was to establish economic stability. Whose? Theirs? The Fed is printing so much money we are going to wind up like Weimar Germany whose hyperinflation was so high people couldn't buy food. This may be us very soon.
If you are not making a payment you are a non preforming asset, or a distressed asset. Forbearance had to be paid (all the payments you missed) at the end of the forbearance, which spurred a refi boom, that and low mortgage rates. 152.7B of the 2.8T was cash-out. Consumers were under duress, pulling cash out and trying to save as much on mortgage as they could because of economic uncertainties, but man did they make money, hand over fist. Who benefited? The U.S. Treasury who holds the largest share of Fannie Mae and Freddie Mac and The Federal Reserve Bank, who lends money to banks to fund mortgages.
The Fed even stated that they purchased the distressed assets to free up bank funds so they could keep lending. Man, did they clean up. What the Fed really did was get the banks to work for far less profits than normal. The Fed would have gotten huge discounts on the now distressed assets, the banks would have paid back the loan they borrowed from the Fed to make those loans with, so the bank could borrow more money from them. So the Fed made out very well, but the banks, not so well, they practically worked for the cost of doing business. They were the Fed's bitch.
TARP was put into place because of the 2008 crash, which was orchestrated, so was COVID (read my book). TARP allows the U.S. Treasury now to purchase distressed assets, no doubt they will be heavily discounted, but that's business, ruthless as it is. Those assets can also be apartment buildings, mortgage backed securities, etc. Because of the moratorium, they will be positioned to scoop up billions of dollars of apartment buildings as REMs or defaulted mortgages at deep discounts, using your tax dollar. You are paying them to be your landlord. Well, they already are, because you will never own land, only the right to pay taxes on it.
Do you think if the Treasury is your landlord, which they already are, they may take your rent out of your pay or unemployment? People will be living in squaller and hunger. This is the beginning of a third world country. The poor can't fight authority. My book has everything to do with this subject.
The majority of renters are paying half their salary in rent. That could be quite a profit for the Treasury, who plans on raising taxes and taking up all the real estate using TARP, for pennies on the dollar, just like the Federal Reserve did by bailing out the banks who couldn't make the payments on the money they borrowed from the Fed, so they could make home loans. The banks said goodbye to their profits for the work they did. Don't think they didn't plan COVID? Think again! We the people are their business, their piggy banks and now, pin cushions.
Here's what the government spent and approved, 4B bailout. Why do you think we are always bailing out? They make money. Do you think the president and congressmen may have stocks in the companies they are funding? The Big Ripoff, is anyone talking about this? This article states that this bailout was for the wealthy, not even close. This is merely the way the government picks pockets, they've been suing banks, weakening them since 2008. They have Fannie Mae by the balls as they can't make a move without the approval of the Treasury because they are still under conservatorship, having paid over 100B in profits from their bailout in 2008. These companies, then and today, must pay it back, it's a loan, not a handout. In Fannie Mae's case it was a purchase of preferred stock. But these bailout loans come with interest payments as well, just like the forbearance on home loans. Our Government and the Fed are crushing it in business, making themselves look like saviors, when they are the ones responsible.
Want to learn more? Read my book