Remember how we talked about commercial debt and default? AKA the "coming crisis? Well here is the slow beginning: The default rate for loans on office, retail, hotel and industrial properties surged to 3.8 percent from 1.6 percent a year earlier, the New York-based real estate research firm said yesterday in a report. The default rate for loans on apartment buildings climbed to 4.4 percent from 1.8 percent.

Earlier, we mentioned today's Congressional Oversight Panel's report on what they call "a commercial real estate crisis on the horizon." The horizon, it turns out, is rather near! So, let's back this up. Commercial real estate loans usually have a rather short term of between three and ten years, and there is often a large final payment at the end of that term-a payment which is almost always covered by an additional loan. The panel is explaining, rather obviously, both that loan default rates are already high and that additional lending is difficult to secure, and so a rather high rate of default on these much larger payments should [...]