SOURCE: USA Today

The debt binging that the caused a lot of the
financial crisis the economy is facing has not been alleviated by the Feds. This is certainly the worst financial crisis in the last 50 or 60 years," says Kenneth Rogoff, a former chief economist at the International Monetary Fund and now an economics professor at Harvard.

The best-case scenario that the financial markets
can expect is that the Feds can lead them to a recovery in the housing market. No one wins if this economic breakdown spreads to other banks and beyond. "It's a really dicey moment we've come to." says Seattle-based money manager William Fleckenstein.

A good article by USA Today which answers a number of questions regarding the collapse of Bear Stearns and its effect on the economy can be found by following the link. It discusses the issues that are worrying the economy and what some analysts feel may take place.

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SOURCE: Wall Street Journal Online

The tough commercial real estate market fund-raising business could be difficult to enter for some but GE feels it will do well for a number of reasons. A falling market poses more challenges but the large and long time real estate investor has a proven track record that should help them in this credit crunch.

One advantage GE believes it has is hundreds of local agents looking into commercial real-estate markets. The funds will get a first look at any potential properties that fit the profile they are hoping to take advantage of. Joe Parsons, chief executive of GE Real Estate's newly formed global investment-management division, said that GE's investment strategy is different from funds focused on distressed situations. Instead of waiting for fire sales, or those properties down about 50% in price, GE is looking at properties discounted in the 10% to 15% range.

GE's goal is to take advantage of the current pricing adjustments while striving to be one of the largest real estate asset management firms within five years. Even GE executives agree that the market is mixed for new funds but are optimistic in their ability to invest well. Mr. Parsons, who recently ran GE Real Estate's North America equity arm, agrees that buying opportunities are scarce right now. "We're hoping the liquidity returns slowly to the market and that presents more opportunity for investing." he said.

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SOURCE: Seeking Alpha

REITs have outperformed other major market benchmarks, states the National Association of Real Estate Investment Trusts (NAREIT) in its latest monthly update.

NAREIT also states that for those "looking for income with relatively low risk" REITs provide a comparatively attractive investment.

In a challenging credit market where investors worry about many companies being overleveraged, most REITs continue to be conservatively leveraged.

David Gaffen of WSJ.com's marketbeat blog "The creditworthiness of this debt is extremely strong," notes Guy Lebas, but of course, that doesn't matter in this environment.

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SOURCE: Courant.com

As the subprime meltdown continues some worry that commercial mortgages may be in for the same ride. There are some major differences between the two types of loans which make a commercial mortgage crisis far less likely. One of the key points to note right now is that delinquency rates on commercial mortgages remain very low, and the risks aren't the same as with residential loans.

There are good reasons to think that the commercial mortgage crisis will not materialize. Actual delinquencies on commercial mortgage bonds were only 0.28% at the end of 2007. Even if that rates toes up, as it's expected to, it is nowhere close to the near double-digit default rates seen on subprime loans

Commercial loans require much more due diligence on the part of the underwriter. There are far more factors that are considered before a loan is issued. The "No Doc" loans that permeated the subprime fiasco are not remotely the norm for a typical commercial loan.

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