heh heh
sometimes watso DOES NOT speak in the third person. sometimes watso pretends that he is not watso, and addresses a point to watso
and back to crypto
the thing is, is that with a doubling of interest rates payable, there simply might not be any earnings - let alone worrying about earning a percentage point less than the business on the other side of the street. that is the problem of too much leverage. watso does not know the first thing about cnp, except that they are highly levereged -with levereged funds, that are invested in further levereged funds
for simplicity sake, look at the following eg
$12m investment, 10m borrowed at 5% but property returning 8% gross income = $960,000 less interest of $$500,000 = $460,000 profit on capital of $2m ie 23%
if interest rates double to 10% then
$960,000 gross income less $1m = loss of $40,000
throw in the wild card of lower property values, and there are problems
only last night on the sbs news, it was reported that xmas sales in the united states was the worst in x (probably 5) years. property centre owners get a part of their income as a percentage of sales - so if sales are down, then income is down - and this affects the valuation of the shopping centres
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