Wall Street Week | AI Debt, Austin Housing Test, Student Loan Reckoning, Canada Weighs US Tariffs

Summary

Steven Rattner warns AI winners are still unknown and credit spreads have widened modestly. A report from Austin shows that increasing housing supply can lower rents sharply. The end of Grad PLUS loans is likely to shift volume to private student lenders. New US tariffs on Canada spare potash while fertilizer markets tighten due to Strait of Hormuz disruptions. Real estate executive Tom Shapiro sees recoveries and dislocations across US property markets.

• AI credit spreads widened slightly but repayment risks remain low; the ultimate winners and losers are still unclear.
• Austin increased housing supply via zoning and red-tape reforms, leading to a 19% real rent drop from the 2021 peak.
• The Grad PLUS loan program ended, capping federal graduate loans and likely pushing students toward private lenders.
• US imposed new 50% tariffs on select Canadian goods but excluded energy and potash.
• Fertilizer markets, especially urea and phosphate, tightened sharply due to disruptions at the Strait of Hormuz.
• Tom Shapiro said San Francisco is recovering, Sunbelt multifamily is oversupplied, and NYC rents can rise on chronic supply constraints.
• Steven Rattner noted rising Treasury yields reflect persistent inflation and high deficits, making fixed income relatively more attractive to some investors.