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While much of the country has been focused on the U.S. Senate hearing on the COVID-19 response… and if our plans to "reopen America" will trigger another spike in coronavirus cases and hospitalizations… and the 14.7% unemployment rate that represents 23.1 million Americans out of work… there's a looming implosion that everyone's been ignoring.
I'm talking about Mortgage Massacre 2.0.
And it's right around the corner.
"Forbearance" and "rent strikes" are already impacting the mortgage market. What's barreling down on us will make 2020 look like 2008 all over again.
U.S. households are cracking under the weight of the debt they're carrying.
Household debt has risen for 23 straight quarters – and as of April, it stands at $14.3 trillion, according to the Federal Reserve Bank of New York.
Auto debt's been rising steadily for 36 months and now totals $1.35 trillion.
Student loan debt exceeds $1.42 trillion.
Credit card debt totaling more than $1.079 trillion just saw delinquencies rise 9.09% in April – to their highest level in two years.
And most frighteningly, mortgage debt at $10 trillion is up $150 billion in a year, climbing a whopping $29 billion in the first quarter of 2020.
As job losses increase and furloughs turn into permanent layoffs, households are going to have a harder and harder time paying their bills, especially their biggest monthly bill, their mortgage or rent.
About the Author
Shah Gilani boasts a financial pedigree unlike any other. He ran his first hedge fund in 1982 from his seat on the floor of the Chicago Board of Options Exchange. When options on the Standard & Poor's 100 began trading on March 11, 1983, Shah worked in "the pit" as a market maker.
The work he did laid the foundation for what would later become the VIX - to this day one of the most widely used indicators worldwide. After leaving Chicago to run the futures and options division of the British banking giant Lloyd's TSB, Shah moved up to Roosevelt & Cross Inc., an old-line New York boutique firm. There he originated and ran a packaged fixed-income trading desk, and established that company's "listed" and OTC trading desks.
Shah founded a second hedge fund in 1999, which he ran until 2003.
Shah's vast network of contacts includes the biggest players on Wall Street and in international finance. These contacts give him the real story - when others only get what the investment banks want them to see.
Today, as editor of Hyperdrive Portfolio, Shah presents his legion of subscribers with massive profit opportunities that result from paradigm shifts in the way we work, play, and live.
Shah is a frequent guest on CNBC, Forbes, and MarketWatch, and you can catch him every week on Fox Business's Varney & Co.