Possible scenario
AAA CMBS Reprices
27% Chance
The market treats the Pimco loss as proof that AAA labels on some office-backed debt no longer provide reliable protection when collateral values collapse. Money managers demand higher yields, forcing weaker office CMBS and mortgage REITs to mark portfolios lower.
Initial impacts
- Market volatility Up
- Riskier companies' borrowing costs Up
- 10-year Treasury yield Down
Secondary impacts
- Finance -2.2%
Tickers
- -2.7%
Portfolio impact
S&P 500-0.5%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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