Federal Reserve calls stocks and real estate ‘risky investments’ day after easing up on crypto
The post Federal Reserve calls stocks and real estate ‘risky investments’ day after easing up on crypto appeared on BitcoinEthereumNews.com. The Federal Reserve called stocks and real estate risky investments on Friday, dropping the warning just one day after loosening its grip on crypto rules. The Financial Stability Report, released by the Federal Reserve, said asset prices were still “notable” even though some markets took hits earlier this month. According to the report, “even after recent declines in equity prices, prices remained high relative to analysts’ earnings forecasts, which adjust more slowly than market prices.” The report also made it clear that Treasury yields across all maturities stayed near the highest levels anyone has seen since 2008. The Federal Reserve also pointed to leverage in the market as a big issue and said funding risks still looked serious. The report, covering market conditions up to April 11, said funding markets stayed strong through the rough patches in early April, but that didn’t mean everything was fine. The central bank made sure to mention that fair value losses on fixed-rate assets were still “sizable” for some banks and that these losses were very sensitive to changes in interest rates. Federal Reserve highlights asset prices, debt, and leverage trouble The Financial Stability Report broke down how bad things looked across four big areas. Starting with asset valuations, the Federal Reserve said stocks stayed pricey compared to earnings even after April’s selloffs. Treasury yields stayed stubbornly high, and spreads between corporate bonds and Treasurys stayed moderate. Liquidity problems built up through the end of March and got worse in April, but trading still worked. On the real estate side, home prices stayed high, and the ratio of house prices to rents hovered near record peaks. Commercial real estate indexes, adjusted for inflation, showed some signs of leveling off, but the Fed warned that refinancing needs could still cause problems soon. Debt didn’t look…
The post Federal Reserve calls stocks and real estate ‘risky investments’ day after easing up on crypto appeared on BitcoinEthereumNews.com.
The Federal Reserve called stocks and real estate risky investments on Friday, dropping the warning just one day after loosening its grip on crypto rules. The Financial Stability Report, released by the Federal Reserve, said asset prices were still “notable” even though some markets took hits earlier this month. According to the report, “even after recent declines in equity prices, prices remained high relative to analysts’ earnings forecasts, which adjust more slowly than market prices.” The report also made it clear that Treasury yields across all maturities stayed near the highest levels anyone has seen since 2008. The Federal Reserve also pointed to leverage in the market as a big issue and said funding risks still looked serious. The report, covering market conditions up to April 11, said funding markets stayed strong through the rough patches in early April, but that didn’t mean everything was fine. The central bank made sure to mention that fair value losses on fixed-rate assets were still “sizable” for some banks and that these losses were very sensitive to changes in interest rates. Federal Reserve highlights asset prices, debt, and leverage trouble The Financial Stability Report broke down how bad things looked across four big areas. Starting with asset valuations, the Federal Reserve said stocks stayed pricey compared to earnings even after April’s selloffs. Treasury yields stayed stubbornly high, and spreads between corporate bonds and Treasurys stayed moderate. Liquidity problems built up through the end of March and got worse in April, but trading still worked. On the real estate side, home prices stayed high, and the ratio of house prices to rents hovered near record peaks. Commercial real estate indexes, adjusted for inflation, showed some signs of leveling off, but the Fed warned that refinancing needs could still cause problems soon. Debt didn’t look…
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