Is The Bubble Bursting At Your Mall?
Many readers see anecdotal evidence of the collapsing housing bubble at the mall. “If you look at graphs in the SD Union Tribune article, it appears that the housing market tanked just before/at the same time unemployment went up. The poor job market DID NOT cause the housing bubble to collapse; it exacerbated it, IMHO. I believe this will happen again.”
“Speaking of jobs…My family and I went to a local mall (North County Fair in Escondido) tonight. There were closed stores EVERYWHERE. Three (or more) restaurants in the food court, and **at least** 15 to 20 stores have closed that were open just a month or two ago, from what I can tell. In one mall.”
“Also, heard from more than a few people in the last three weeks (in LA and SD) that traffic seems lighter. Anyone else seeing the same?”
Another added, “It is happening around here in SE MA as well. The two malls closest to me have multiple stores that are empty, including some pretty big spots. One of them is an outlet that had over several years worth of waiting lists to get in.”
“One thing to keep in mind with many of the malls in San Diego is that they are owned by the same group. Rents have been pushed up agressively in the past couple of years from everything I’ve heard. Many of the smaller, unique local stores have been pushed out by larger chain prestige brand stores coming in who can pay higher rents and have much deeper pockets. When even these places start folding, it’s definite that people’s spending habits are switching gears.”
Another, “The Gap employees have been murderously following me around while I’m shopping to tell me about their new pants or sales lately. It is really quite frightening!”
One from Phoenix added. “See today’s jobs report: Retail lost 43,000 (I think). I’ve noticed less traffic in Phoenix. Also, a bit of anectodal evidence: my neighbor is part owner of a large mortgage company in Phoenix, and they’ve dropped from 70 to 50 MB’s since the beginning of the year. I also know guy that quit his bartending job early last year to become a MB. Bet he’s back at the bar.”
An update on the mortgage business. “Ameriquest Mortgage Co.’s decision to close all 229 of its retail branches and eliminate 3,800 jobs follows a steep decline in its lending volume. The Orange-based lender said loan volume plunged 46% to $2.6 billion in the first quarter from $4.8 billion a year earlier.”
“With interest rates rising, fewer people are looking to refinance, triggering a wave of layoffs in the industry and leading to predictions that weaker lenders would be acquired or shut down. Competitors such as Saxon Mortgage in Glen Allen, Va., and ECC Capital Corp. in Irvine have closed retail offices to save money.”
“The 3,800 job cuts announced Tuesday, from a staff of 11,000 people, did not include reductions at Ameriquest Mortgage’s biggest sister company, Argent. In addition to employees at Ameriquest’s branches, about 400 at the company’s headquarters were handed pink slips.”
‘The Orange-based lender said loan volume plunged 46%. About 400 at the company’s headquarters were handed pink slips.’
Sounds like some brokers and staff in Orange county have gotten a big pay cut already.
The big wet blanket in Arizona is the gas price. The refi bust hasn’t taken hold yet, but it’s just a matter of time. Many spread out towns that rely on tourism are feeling the pinch. I see retail and food closings. Funny that Wall Street rallied on a poor jobs report. If the Fed pauses, it is only because they fear a recession.
Here’s a little blurb which I liked a lot about the “Stadium Name” indicator. Pretty sharp.
Mustard and Mortgages
Ryan Krueger
May 05, 2006 2:30 pm
Once everybody is aboard an idea, who is left to push the boat even if it works?
I was watching King James’ coronation (with the beard you almost forget LeBron is 21 don’t you?), held at the Quicken Loans Arena. Can a triple-double ever spell trouble? The time had come to revisit what may be one of our most reliable indicators of all-time. You may recall a few years ago when technology companies started paying for scoreboards instead of motherboards. The story opened when certain companies had so much extra money on their hands that they decided to buy the naming rights on sports stadiums. Painful reminders are still etched on brokerage statement scorecards to remind folks how this game ended for some of those companies. Looking back, the stadium indicator signaled a few “top-ticks” in the stock market.
At last check, there were 70 major sports stadiums that had sold their naming rights, according to data from ESPN (“Yes, Honey, I am still working.”). I organized this list, just as I did six years ago. I was shocked by the results, had no idea how many of the names had changed in the past few years. There are now 22 stadiums financed by financing companies! If you were inclined to divide 22 into 70, you would see that financial companies represent more than 31% of this stadium naming “index.” That is an eerie number for those of us that remember when the technology sector peaked after representing 29% of the S&P 500 in 1999.
I was just as surprised six years ago as I was today that so few are stopping to ask a basic question: Once everybody is aboard an idea, who is left to push the boat even if it works? The fundamentals are a source of great debate but the key, yet often forgotten factor in causing a stock to go up in price tomorrow morning is whether or not there is an imbalance caused by investors who do not own the stock yet and want to. The stock market is an auction, not a store. We believe technology stocks stopped going higher not because the business got bad (many did the exact opposite) but because almost one out of every three dollars in the stock market already owned a technology stock in 1999! The same can be said today about financial services. I think our own El Presidente Wassong nailed it, in his hot dog eating essay. Even Kobyashi gets full at some point and my hunch is that the market’s hot dog (largest sector) threshold gets full around 30%. Don’t forget the other way to outperform the stock market - being right about what NOT to own. I’m not calling for a collapse but I’m dramatically underweighted in the sector and almost all of my chips here are placed on unusual names, some that will benefit directly from the puking of the usual suspects in this sector, once the mustard is on the mortgage that finally stops going down so easily.
“It’s so popular no one goes there anymore.”
Yogi Berra
The lenders are also on my short list of short targets.
I’m short FNM, but I’m a little scared about Wednesday. I’m hoping the fed target rate increases. If not, lenders and home builders will jump a couple of points. On the flip side, that’ll be a good time to establish new short positions (with lunch money).
“Stadium Indicator”…I like it.
This morning, I went to watch my son play T-ball, and the outfield billboards were 67% (22/33) billboards from the Real Estate Industrial Complex. Finance, RE brokers, construction companies, well diggers, lumber yards, landscaping services, etc. I did not include banks (BoA) or nurseries.
I wonder what the local economy will look like when the REIC devours itself.
Great post txchick — I got my over the top feeling of eerieness when Ameriquest sponsored the Stones tour, as if the RE industry’s heavy rotation in radio and TV wasn’t enough…
The thing that grabbed my eye when I went to see the Padres play last summer was all the RE-related advertisements up on the walls of Petco Park. (Brings to mind the thing that grabbed my eye as we drove through LV last summer — all the major HB’s billboards lining the freeway alongside of the vast sea of residential housing in the middle of the Nevada desert.)
Might be worthwhile seeing what the breakdown of these RE-advertisements on the wall of Petco Park are between JMI Realty and other RE offerings.
At its heart, San Diego’s Petco Park is a RE scam run by John Moores (owner of the Padres) and his real estate empire (JMI Realty). As reported in great detail by Don Bauder (ex Financial Editor of the San Diego Union Tribune and now of The San Diego Reader), the construction of Petco Park gave John Moores the cover he needed to seize prime downtown properties under ‘eminent domain’ for pennies on the dollar.
The amusing thing is that, contrary to the initial prospectus offered by Moores to the San Diego City Council, most of the condemned land went to build massive condominium projects. Would be interesting to see the collapse of the downtown San Diego condo market occurring at the same time that criminal indictments come down for Moores concerning his sale of Peregrine stock before accounting ‘irregularities’ became publicly known.
The Morning Snooze yesterday in its top story trumpeted the expansion of NorthPark Mall into one now the equivalent of the great consumer citadels of the U.S. such a Facist (oops) Fashion Valley in San Diego or South Coast Plaza.
I think with this we can safely call the top in Big D (that’s “D” for “Debt”)
Shopping is a sport in Dallas. After the last, bust diamond studded rolexes were a dime a dozen at the pawnshops.
Still are.
I haven’t seen any slowdown in Southern NH. Malls have plenty of cars in them. Housing prices seem stable too. Of course we’re getting people moving from expensive Massachusetts along with shoppers from sales-tax weary Massachusetts that drive up to shop at our malls near the border.
Buffett is talking about the housing bubble. He’s been reading the annual reports of the lenders and the amount of deferred interest is skyrocketing in recent years. Taking a looking at just one lender, Golden West Financial which owns World Savings we see the following:
“The aggregate amount of deferred interest in the loan portfolio amounted to $449 million, $55 million, and $21 million at December 31, 2005, 2004, and 2003, respectively. Deferred interest amounted to less than .39% of the total loan portfolio on those dates. Deferred interest levels increased primarily because the balance of ARM loans in our portfolio increased by $41 billion since 2003, the indexes on our ARMs increased, the minimum payment on most new and many existing loans was less than the interest due, and many borrowers made monthly payments that were lower than the amount of interest due. We do not believe the aggregate amount of deferred interest in the portfolio is a principal indicator of credit risk exposure. Nonetheless, we carefully monitor the payment behavior and performance of all loans with deferred interest.”
Not only is the debt piling up, but the unpaid interest on that debt is piling up. Will be interesting to see if this turns out to be a no-risk development.
We do not believe the aggregate amount of deferred interest in the portfolio is a principal indicator of credit risk exposure.
That quote should appear in a high school history book 20 years from now.
GDW’s portfolio is 99% ARMs, mostly concentrated in California. They are supposed to be a conservative lender, but I know TOTALLY UNQUALIFIED people who got neg-am loans through them.
I talked to World Saving’s branch manager, where I have a jumbo CD, and asked him about the risk to the bank of all those ARMs resetting. He said he had an ARM himself, and the payment has never gone up, so what was my concern? Can you believe it? I told him he was obviously still in his intro period! He invited me to pick up an Annual Report to verify their validity, but I know the default info is not published thre. That’s considered “confidential”.
dont hold more than 100k there.
I did see somewhere that their defaults were up, but not by much…yet.
GDW (World Savings) was holding Option-ARM seminars to lure refis and new purchases over the past year or two. I have to think they will go away when this is over…
Is GDW on the plunge protection list? I am trying to understand what fundmental reason explains the stock price dropping with the big Wall Street builders last fall, then reverting to what appears to be a permanently high plateau early this year (kinda like Fannie Mae).
Buffett is making a large bet against the dollar, which of course is another way to play the housing bubble.
better to buy non-US mutual funds. Ive seen modest appreciation with them, despite the dollar’s strength this past 12 months. Even so, the road ahead is so murky that I feel its best to be diversified in everything but real estate.
Trouble is that a worldwide economic slowdown (the natural sequel to a global credit bubble) will sink non-US mutual funds along with all other equities, in the same way the bubble blew equities skyward (notice how the DJIA has hit post-dot-com highs in the past week?).
Yeah, I’ve got alot of my 401 ~40% in a foreign index fund to get out of a devaluating dollar, but post devaluation I think that the US will be in better shape than the rest of the world. I’m hoping that there will be enough of a lag to get my money out of quatloos and back into dollars after they devalue, but trying to rely on that sort of timing is scary.
i see no shopping slowdown in the Northeast US. people are shopping without a care in the world and these spoiled teenagers spending out of control. parking lots still filled with yenta housewives loading up their HUGE SUVs with bags and bags and gabbing on the phone as they pull out as almost hit me. It seems that nothing can stop these creatures - not even $3-4+/gallon gas.
I have a theory on this, the mortgage equity extraction creates lumpy spending habits. Instead of a gradual decline related to rising unemployment you get a steady spending rate. Until equity extraction drops off a cliff thanks to a flat/declining market.
When the cash runs out people aren’t going to gradually slow their spending, they’re going to yank the e-brake.
Interesting theory; I hadn’t heard it put that way before but it makes sense. You could say the same thing about young mortgage brokers used to making $300k/year and now holding a pink slip.
i think it starts with the credit cards. you have so much credit with bank and store credit cards and they get loaded up with all this debt and revolving balances until they get maxed out. then the family sees a DITECH commercial and does a HELOC and pays them all off with the phantoim equity. then they repeat the cycle - until the music stops and the chairs are all taken.
speaking of which - i see very little discussion on this company and its marketing to the sheeple -
http://www.ditech.com/
A GMAC Company?
Kirk,
IMO, you are absolutely correct. The wealth effect of the housing bubble will take a while to dissipate. The credit card-to-HELOC game they’ve all been playing so far, has been working for years. They don’t get it, yet. Many people still don’t know the market has shifted. At worst (to them), prices will plateau or, God forbid, drop 10% or so before resuming its upward march in a couple of months. No worries here…until the time they try to refi/HELOC and get stuck. Spending will **stop** on a dime, IMO. I’m just wondering if it’s already begun. I think we’re seeing the leading edge. San Diego was at the forefront of this bubble, and the market’s been basically flat for two years already. We’ll feel it first, IMO.
Good theory Kirk. I think you have a lot of spending junkies out there– the will absolutely not stop unless credit dries up. The spending high also might last longer because consumers who have used equity to pay down credit card debt will go right back and run that credit card up again when they can’t get their equity-extraction fix.
Which makes me ask -is there a site that has data on credit card debt run-up — might be worth monitoring these days..
Oops let me answer my own question:
http://www.federalreserve.gov/releases/Z1/Current/z1r-2.pdf
Shows quite a big decrease in credit card debt growth and credit card borrowing thru home equity party years 2000-2005 -wonder what this year’s data will bring??
Housegeek, Ben, I’d be really interested in monitoring credit cards too. I’d like to get a better handle on where different segments are in debt to income ratio if the info is out there.
“spending out of control. parking lots still filled with yenta housewives loading up their HUGE SUVs with bags and bags and gabbing on the phone as they pull out as almost hit me.”
Vomit inducing truth. These debtors have no clue.
I haven’t been to a mall in I don’t know how long. I detest malls. I can’t stand the stupid teenyboppers spending mom and dad’s HELOC money. Malls are basically a caricature of everything that is wrong with this country.
OT: Re: Teenagers
Why Today’s Youth Is Garbage
Problem #1: They’re mentally weak
Problem #2: They blame the older generation
Problem #3: They have no motivation and ambition
Problem #4: They’re a “Me & Now” generation
Problem #5: They’re a society of victims
Problem #6: They have no respect for authority
Problem #7: They’re welfare recipients
Problem #8: They have no etiquette
Problem #9: They like crappy music
http://www.askmen.com/money/mafioso_100/102_mafia.html
Wow, you should be a professional generalizer. I teach teenagers as part of an intership so I have a good sense of their habits.
Based on my experience you appear to be a grumpy old curmudgeon so here’s my rebuttal…
Why today’s non-youth are garbage.
#1> We don’t understand technology
#2> We are more set in our ways
#3> We’re dumb enough to keep buying houses
#4> We don’t understand money (see #3)
#5> We fear change (see #2), which is accelerating, which manifests itself as arrogance and comments like yours.
#1> We don’t understand technology.
Since when does using text messaging, myspace, expensive cell phones and violent video games equal technically adept ? Most of us old farts here were “lucky” to have the 1st computers made.
#2> We are more set in our ways.
Having a job and responsibilites kinda crimps your time for hanging with the buds at the mall. I remember having free time.
#3> We’re dumb enough to keep buying houses.
We’re wise enough to see the writing on the wall and stop. How many flippers and condo buyers did we read about in their 20’s ?
#4> We don’t understand money (see #3).
This bunch here are the biggest bunch of tightwads (in a good way) on the planet. We’re retiring early.
#5> We fear change (see #2), which is accelerating, which manifests itself as arrogance and comments like yours.
Baloney, change is good, boredom is no way to live life.
Now you darn kids get offa my lawn !!
:end Curmudgeon
Sounds like an old guy in Omaha giving
an annual presentation this weekend.
Except he likes to buy companies instead
of houses. There are many in Wall St that claim that he doesn’t understand money too.
Really, it’s not their fault but their parents’. They are blank slates. Most people having kids shouldn’t be IMO.
“Any fool can have children … and they usually do.”
- Woody Allen
This from a guy who dated his step-daughter?
Speaking of young people ( a little levity)…
What a difference 30 years makes.
1976: Long hair
2006: Longing for hair
1976: The perfect high
2006: The perfect high yielding mutual fund
1976: KEG
2006: EKG
1976: Moving to California because it’s cool
2006: Moving to California because it’s warm.
1976: Growing pot
2006: Growing pot belly
1976: Trying to look like Marlin Brando or Liz Taylor
2006: Trying NOT to look like Marlin Brando or Liz Taylor
1976: Seeds and stems
2006: Roughage
1976: Popping pills, smoking joints
2006: Popping joints
1976: Killer weed
2006: Weed killer
1976: Hoping for a BMW
2006: Hoping for a BM
1976: The Grateful Dead
2006: Kevorkian
1976: Going to a new hip joint
2006: Receiving a new hip joint
1976: Rolling Stones
2006: Kidney stones
1976: Being called into the Principal’s office
2006: Calling the Princicpal’s office
1976: Screw the system
2006: Upgrade the system
1976: Disco
2006: Costco
1976: Parents begging you to get your hair cut
2006: Children begging you to get their head shaved
1976: Taking acid
2006: Taking antacid
1976: Passing the driver’s test
2006: Passing the vision test
1976: Whatever
2006: Depends
I changed the dates, but this is a list Beloit College in Wisconsin puts out every year. Kind of funny.
We now return you to your regularly scheduled program….
LOL!!!!!!!!!!!!! Very funny!
On the today’s college freshmen meme. Today’s freshmen were born the year Jean-Luc Piccard took over the Enterprise.
I’ve noticed this since Christmas. Parking spots are getting easier and easier and EASIER to find.
Traffic also feels lighter, but I think that is also a reflection of gas prices. For example, my wife and I carpool on Thursday as we are headed in the same direction on that day. Previously we didn’t bother adjusting our schedules.
I’ve noticed this since Christmas. Parking spots are getting easier and easier and EASIER to find.
___________________
Yes, I noticed it this past Christmas as well. First time in YEARS we were able to easily find a parking space — convenient ones at that.
I was listening to a real estate show on 97.1 in LA today and tones are definately changing. A few months ago on this show all the callers were very gung ho about buying property. Today the most common asked questions by callers was”should I buy now or wait”? Of course these hooligans running the show(it is called House Calls)said “no dont wait there is no bad time to buy RE”. On a later show run by a mortgage broker in LA a caller said he had bought an investment property in Florida last year for 414K and now it is only worth about 325K and his ARM is adjusting and he doesnt know what to do. But a little later the hosts of the show said that RE was still going to appreciate 5-10%. Doesnt add up.
The thing is ,the downturn has’nt really even started yet and the RE community talks like it was just a minor blip and now RE will start appreciating again, be patient and hold on people, the real bust is coming. I think this could be worse than any one thinks.
“no dont wait there is no bad time to buy RE”
In the long run, real estate prices always go up.
But in the long run, we are all dead…
In the long run we are all dead.
So man, I’m plugging myself right now. Gotta keep up!
“Also, heard from more than a few people in the last three weeks (in LA and SD) that traffic seems lighter. Anyone else seeing the same?”
Yes. My morning commute is much less congested, now that all the condo flippers and many of the SUVS and Hummers have left the road.
My commute in north county san diego has definitely been cut by 20% or so. I think gas prices, a general construction slowdown, and a cut back in spending across the board on discretionary items is hitting people noticeably.
The lightest day on the road was the day without immigrants.
Amazing difference last Monday in some areas.
Four weeks ago was the daylight savings change. It always changes the traffic patterns here it in the Bay Area, though I’m not really sure why. I notice this most during the Fall change, when traffic seems to get suddenly worse.
You know that’s it. I noticed the improvement in traffic after DST as well. Can’t explain it off the top of my head… and brain is off for Saturday night.
“One thing to keep in mind with many of the malls in San Diego is that they are owned by the same group.”
And let me guess: This “group” somehow pulls in funding from outside of San Diego, where it is harder to notice the huge excess supply of retail floor space. There has never been a very high footstep density in any mall I have set foot in here, and I have only lived here during a period of superficial economic strength. When the effect of the empty housing ATM really hits home, these malls will turn into ghost towns and vandalism targets. I have seen it happen before in other times and places.
It’s GGP (General Growth Properties).
http://www.generalgrowth.com/properties/mall_directory.asp
I almost never shop in San Diego shopping malls, largely because they have taken over by outside “groups” (e.g., Westfield) and seem to be filled with trendy boutiques selling junk in which I have no interest.
Recently, I tried the University Towne Center-Westfield to buy a new pair of dress shoes. Good thing Nordstroms still carried them, as there wasn’t a single other outlet selling them.
I think that San Diego is especially vulnerable to an economic downturn, due to low median salaries (lots of service jobs, less professional employment) and (tah dah!) we lead the nation in gasoline prices.
Damn, I can agree with the “junk boutique” sentiment.
Anything good has to be purchased off ebay.
DestinSM can speak to this as he is in that area, but I did a Fla. trip ,up one coast ,and down the other several months ago during what should have been the peak tourist season….No exaggeration, miles upon miles of strip malls with MAYBE 5-10 cars each. I assumed half of those cars were employees…It has to be a tax dodge , or reits building to show growth as there was no way in hell that there was the demand to support all these….Sad really, as now every square inch of Fla is now paved ,and hard to find an open beach anymore unless your at a condo development or gated community…
About half of those strip malls seem to be rented out to lenders or real estate agents. But you also get a lot of people who are already retired and drawing one pension from somewhere who run a small business to keep from getting too bored.
Most of the bicycle shops in my area are run by fortysomething or fiftysomething military retirees. The pension check buys their food and pays for their home note or home rent. The bike shop runs a slight profit, and is also a lot more interesting than playing golf every day for them.
New mall in my area is going forward with plans to double in size even with the increase in labor costs.
My wife and I were walking through Hillcrest today (San Diego). On University Ave there no less than four RE storefronts in one mile. One SHARING space with a dry cleaner. This is so fun.
The shpping here is as busy as ever. Went to METROPOLIS today near Vancouver.
Grocery stores and Costcos have heavy traffic in Sonoma County. I haven’t been to a mall literally in years, but I have a big Circuit City gift card. Everytime I go CC, it’s light traffic and I get a parking spot right in front everytime. I wish they carried items that I would actually buy. I should just eBay off the remaining balance…
Shopped today at Sam’s Club. Pretty busy. At Target, very slow. Do shopping now in “clusters”.
Changing mindset in proportion to gas price escalation.
Simon Property Group sued our town this year and won so they’re going to put in a huge premium outlets mall in our town. This is going to create massive traffic issues with people driving from Mass to shop here.
I concur with the earlier NE poster that shopping isn’t slowing down.
I made a relatively rare trip to the Solomon Pond mall in Northborough, MA Friday evening. Went to get a Lego set for the 8-year-old. The lady at the Lego Outlet told us the store is closing for good in two weeks. Everything in the store is at least 10% off, some items are 50% off. We were the only customers in the store (it was packed at Christmas time). The kid didn’t care for any of the stuff though, so we went across the aisle to KB Toys. Which was closed, sign said they’re moving two doors down to another (presumably shut down) store. Walked upstairs to the food court and saw least 3 food outlets were no longer there, new names in their place.
For a Friday evening, foot traffic felt pretty light as well. Open parking spots next to the major anchors, which is quite unusual for this place. If someone told me “retail sales are way down”, I would believe that person.
Went to Home Depot today in Denver to get some screws… Sat @ 5pm NEVER seen it so dead, had a sales guy helping me the right ones for like 5 minutes. Every other time I’ve been in this store you’re basically following a grumpy worker around for 10 minutes while he helps others just to ask a simple question.
Anyhow, traffic seems lighter too, but gas is as much the culprit there as anything else.
I’ve also notice work stopped on a few remodels I drive past regularly…
Went to K-Mart tonight, only because I collect Matchbox cars and every once in a while they have what I’m looking for. There were 6 cars in the parking lot. One cash register was open, and nobody was checking out.
Of course, this IS K-Mart I’m talking about. How they manage to avoid bankruptcy is beyond me.
I’m confused. Where do people getting their money from? big executives from Microsoft?
http://seattletimes.nwsource.com/html/businesstechnology/2002975855_homesales06.html
Interesting. In my former town in CT the RE listings have had 6 millibuck homes online for four months. Recently the most expensive listing disappeared and 4 others took its place. Not exactly an active market at the high end.
The same cannot be said up here in Calgary Canada. The city is the midst of a true housing and labour shortage. Some observations:
Want ads full of jobs and no takers.
1) Malls are full
2) Roads cannot handle the increased traffic.
3) 30% home increases in Jan-Mar of this year alone!
4) Bidding wars breaking out. The house next to us sold in 3 days. Some have sold in hours.
5) People are living on the outskirts of town in trailers because they can’t find an affordable place. It’s not like this is a small town. We are at almost 1M people.
6) Dairy Queen is paying $10/hr + signing bonus
7) I am beginning to see more and more exotic cars on the road. Starting to remind me of when I lived in Sunnyvale in ‘98
This is not good. Everyday costs are going up like crazy.
It has all to do with the oil.
And Calgary’s housing market will crash with the oil market in the next five years. (Refer to TX in the mid-80s if you are interested in reading the handwriting on the wall.)
Thanks, I will look into the TX experience.
Home depot, Lowes and their ilk are going to be the true indicators. Here in Santa Cruz county HD put up a store in Watsonville which is about 14 miles from Santa Cruz City proper. The store is never crowded and it services the whole county of approx 250,000 people. I drove by today and the parking lot was barely half full. The kicker is that HD is putting up a new store in Capitola which is 5 miles from Santa Cruz right across the street from a well established lumber yard. It used to be privately owned but was sold to Lumbermens Inc. about 2 years ago. Someone is going to close their doors as the flipper/remodeling craze wanes. I really think it’s gonna be one of those HDs.
I notice few people in the theatre when I go to see a movie. At $10 a pop, no one can afford it!
We’re heading into a recession in the next few months.
http://www.financialsense.com/editorials/griess/2006/0224.html
I’m going to call it right here on Ben’s blog. My prediction:
We are in a recession. It’s starting here in SD (and other advanced bubble areas), and will move across the country like the housing/credit bubble did. Govt’s numbers are a lagging indicator. When the numbers do hit, it will be swift and dramatic. I was one of the October pessimists last year, and will go with that month again for 2006. Official recession by October 2006. Depression by mid-2007.
Hope I’m wrong.
I’ll go with October as well. And I’m a pessimist’s pessimist.
(Having had my pessimissism cost me actual $$$$ in the past.)
But this is the real deal.
According to Williams “Shadow Statistics” we entered a recession last year. The official government numbers are just so much political propaganda anymore.
Too true.
Well, I have to venture into the mall today for the first time in probably 5 years to use up a gift card which I was given over a year ago. I have done all shopping online for years now. It’s going to take several hours of mental preparation to confront the assault on my senses. Seriously, it’s like a carnival to me.
I am going to buy 10 pairs of Crocs with the card, some for myself and my husband and some to give to others. What a great product but does the company deserve to be a public company with a billion dollar plus market cap? Sheesh.
Wow, Txchick. I had no idea what a “croc” was & looked it up. $30.00 flip flops on their site. You go, girl!