The Institutional Risk Analyst

New York | Last week The Institutional Risk Analyst attended an evening presentation by Professor Edward Altman of NYU Stern School of Business at The Lotos Club of New York. Entitled “The Altman Z-Score After 50 Years: What is it Saying About Current Conditions & Outlook for Global Credit Markets,” Professor Altman’s comments were as usual understated and entirely on point. “Fifty years ago, we published the Altman Z-Score,” Dr. Altman told the audience of friends, colleagu

New York | Fed Chair Janet Yellen’s defense of the benefits of regulation last week in Jackson Hole probably killed her chances for reappointment, but the more pressing reason to see Yellen return to the private sector is visible in the US real estate market. Chair Yellen and her colleagues have created large bubbles in many assets classes from residential homes to commercial real estate to construction lending. As in the 2000s, this latest bout of asset price inflation wil

In the mid 2000s, just before the financial crisis began, US banks were reporting credit metrics for all asset classes in loan portfolios that were quite literally too good to be true. And they were. The cost of bad credit decisions was hidden, for a time, by rising asset prices. The same aggressive, low-rate environment used by the Fed to artificially stoke growth in the early 2000s has been repeated in the aftermath of the 2008 crisis, only to a greater extreme. Today US