2023-11-26 19:30:26
The Signa case will not trigger a real estate crisis. The shaky Signa holding of the dazzling René Benko does not serve as a domino for the approaching collapse of an entire industry. But Signa is definitely a blueprint – for more. The holding represents what could now threaten many companies – across all sectors and regardless of any economic inaccuracy that still needs to be checked. The mixture of managers’ overconfidence and cheap money in times of low interest rates could still prove to be very toxic.
For years, central banks have flooded the markets with cheap money. Due to the disruption caused by the financial crisis in 2008, they felt compelled to do so, as the interest rate screw is seen as an effective instrument for stimulating the economy again. The mere fact that cheap money is available in abundance does not oblige any entrepreneur to take it. And no bank has to finance overly complex projects. Once again it will now be true that it is rarely worthwhile to place return considerations above risk parameters. Anyone who doesn’t think about the change in interest rates in a time when interest rates have been practically abolished doesn’t understand their business.
#Blueprint #Signa