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  1. spatny
    Member

    Or, We Ar Not Alone....

    (In Lincoln Park, one of Chicago's wealthiest neighborhoods, about two dozen stores have gone dormant in the past year on the prime shopping strip along Armitage Avenue between Halsted Street and Racine Avenue. Among the casualties: Fresh or Faux, Moonlight Graham and Entendre Couture closed. She Boutique left to consolidate with its Highland Park location, where rent is cheaper. And the little cottage that housed Ethel's Chocolate Lounge, a Mars Inc. venture, stands empty.

    The biggest eyesore sits at the west end of the street where the Armitage Collection, a 40,000-square-foot mini-mall conceived during the boom, remains vacant but for a hair salon that relocated from down the street. The project, one of Chicago-based M Development LLC's ventures, is battling a foreclosure suit. Officials at M Development didn't return calls seeking comment.

    As the boutiques moved out, the resale shops moved in. A furniture consignment pop-up shop called Millionaire Rejects and a designer sample sale shop from San Francisco called Thread Lounge are the newest fixtures on the street.

    The bare spaces and discount stores prompted residents, worried about their home values, to gather in September with shopkeepers, real estate executives and Ald. Vi Daley, 43rd, to discuss how to keep the Armitage neighborhood from looking like a retail ghost town.

    "We need to add a little excitement and a reason for people to walk this way," said John Witte, co-owner of the Poison Cup wine and art boutique, which opened on Armitage in April after a florist moved out.

    Daley said she is working with the city's cultural affairs office on a stopgap measure to turn the empty spaces into temporary art galleries.

    "I've never seen vacancies like this on the street," Daley said. "Everybody's concerned about it."

    Not long ago Chicago was on its way to becoming a fashion oasis.

    Mayor Richard Daley appointed a fashion czar. First lady Michelle Obama propelled favorite designer boutiques Ikram and Maria Pinto into the national spotlight. And the Washington Post's Robin Givhan, a Pulitzer Prize-winning fashion critic, dubbed Chicago the "Milan of the Midwest."

    "It was a stage where it was certainly blossoming," said Lois Weisberg, commissioner of cultural affairs for the city of Chicago. "Designers were opening their own boutiques. Then all of the sudden they were having a hard time paying rent because of the recession. My fashion people did meet to see what we could do to help. It's very, very difficult. We can't pay the rent, they can't pay the rent."

    The scene is similar on the Southport corridor. The North Side strip of boutiques and restaurants was on the cusp of becoming the next hot shopping district when the recession hit. Like Armitage, Southport is dotted with vacant storefronts and for-rent signs. And the new 20,000-square-foot retail complex called the Southport Collection remains vacant.

    "Three years ago getting an apparel tenant was like falling off a log," said Joe Padorr, director of marketing and leasing at Preferred Development, the Chicago developer behind the Southport Collection. "Getting a bank was like falling off a log. They were expanding branches. Starbucks was expanding. Now there's just fewer of them doing deals, and the ones that are doing deals are the Dollar Stores."

    Preferred Development bought three buildings, including the one that housed the restaurant Red Tomato, on Southport Avenue by the elevated train stop in 2007. The firm had a tentative agreement to bring in yoga gear store Lululemon and was talking to such national chains as Club Monaco and Banana Republic when the market tanked, Padorr said. Now, Preferred is leasing part of the space to a Halloween pop-up store and has an agreement to bring in Wicker Park Fitness club in early 2011 after the building is gutted and redeveloped.)

    Posted Thursday Oct 29, 2009 21:36 #
  2. anonymous
    Member

    They are not alone. Have you been through Western Springs and Hinsdale lately? Oak Brook seems to be a ghost town, too. I'm boycotting the City of Chicago, with their crazy parking fees and sales tax. If anyone has any money to spend, like teachers and other government employees, please go shopping. they seem to be in the only industries that are not affected by this downturn and are not in any danger of losing their jobs.

    Posted Friday Oct 30, 2009 11:47 #
  3. spatny
    Member

    Here's an interesting view on the present economic situation... not mine entirely, but thought provoking.

    (The problem is debt. Debt that is impossible to repay.

    Ever hear of Blind Faith?

    We have surpassed Zero Hour but rather than cutting expenses and tightening our belts and getting back to the real work of value added productive endeavors we just go out and start to dilute our currency.

    Why? Because there is only one school of economics taught in this country and one set of business organizational design and that is around more and more debt.

    When people are trained to either follow orders or trained in a discipline, like a religion, FEW question. Faith is easier than thought. It is a human nature and a downfall. Mob rule and religion and patriotism are all a part of having faith. Academian discipline is mostly just another form of faith. Even new scientific discoveries are disbelieved at first until the evidence is overwhelming. In economics, when only one faith is taught, there is little disagreement.

    I think that MOST of the government and most of the Banksters actually believe in the discipline that they have been taught. Most are trained to not think for themselves and to follow the rules. Whistle blowers are shunned and ostracized. Contrarians and real risk managers are disposed of. We have a culture of Positive Thinking. It is in our nature. Government use to set limits on this kind of overly optimistic crazy risk taking but during Clinton and then with Bush, all restraints were removed.

    Our universities only teach ONE branch of economic theory. Under which the economy can be controlled by monetary policy. Under which, debt is good as it allows ALL assets to be *used* or devalued. Under the NEW bastardized modified Keynesian Economic theory, savings are destroyed by forcing all savings to be leveraged against rising asset values. Risk is non existent by turning it into a commodity to be sold. Nothing is really about production in the NEW Keynesian Theory that most all of today’s economists preach. So in reality, there is really nothing except betting on future trends and off shoring production to those who are still willing to work.. After all, no one has to work under the New Keynesian Economic System. And those who don’t play the game are marginalized and frowned upon and eventually forced into poverty and servitude.

    This is the model of American Capitalism we currently have. Under the terms of the New Keynesian Economic Model, you are right, growth by debt is good and great news. In the real world there are limits to the amount of debt because it has to be serviced. When those who are responsible for servicing the debt are over burdened with expenses, in the real world, they start defaulting on their debt obligations. No additional amount of debt, spent on additional consumption can solve this long term. So when a government relies on the solution of more and more debt over and over for decades, there comes a point where the carrying capacity of this debt burden is exceeded. The result is deflation and debt revulsion. When you can only create new debt by bribing the debtors with cash for clunkers or cash for foreclosures this should be a sign to everyone that we have exceeded a climax for debt..

    But those who are in charge believe in a system and beliefs are hard to change. This is all they and maybe you know so the gobbermint will continue down this path until overwhelming evidence, probably in the form of a depression, will cause them to lose faith.)

    A note and prediction: I have had substantial (for me) funds in ING Direct, the U.S. on-line affiliate of the ING Bank of the Netherlands, for many years. The Dutch have always been pretty good at investing and practicing a more risk-averse policy than we have, and have also paid substantially higher than average interest, etc. Recently, because of the economic situation, ING was forced to take some $10 billion from the Netherlands government due to bad debt. Now the EU is requiring them to sell off several of their subsidiaries, their Euro assurance company and ING Direct. There's no problem with that for me as they are FDIC insured here in the U.S., but it will be interesting to see who comes in to buy them. I think they are selling now because after the first of the year there are likely to be a raft of smaller banks here (and abroad) that fold their tents. Why? As above, the problem is debt. Debt that is beyond the capacity of the borrowers to repay. Too many are inundated in it.

    The first-time buyer money and the cash-for-clunkers programs have bumped the system, but really those programs have just moved forward sales up by a few months. If, even with these stimuli running the tax revenues are falling, what will happen after the first of the year? It has to get worse, probably substantially so. And how many retail stores that are now pinning their hopes on Christmas shoppers and don't have a great holiday selling season will fold their tents? I predict the 1st and 2nd quarter numbers next year will be brutal.

    The only thing I could see that would lift this cloud is calling an end to the adventure in Afghanistan. But again, there's a lot of Blind Faith wrapped up in that too. Ideas?

    Posted Saturday Oct 31, 2009 10:19 #
  4. anonymous
    Member

    spatny, this is interesting. where is it from? I agree with a lot of it.

    Regarding Afghanistan? I say leave now. Why are we there?

    Blind Faith? Love their music.

    Posted Saturday Oct 31, 2009 14:59 #
  5. spatny
    Member

    The generation gap strikes again! I had no idea that there was a group (?) called Blind Faith. I listen to guys with two normal names, like Duke Ellington, Count Basie, Stan Kenton, etc. And of course Peggy Lee, who has the right idea for these times...

    That usedto be called "Baby Fat."

    Maybe the big hit for 2010 will be this one:

    "Blind Faith" will probably cover it. (Maybe they already have.) I'll look them up on youtube.

    Posted Saturday Oct 31, 2009 15:03 #
  6. spatny
    Member

    CIT files for bankruptcy, siffs the gov for $2.3 billion. One of the largest small biz loan sources now in question. Just happened.

    Posted Sunday Nov 1, 2009 16:26 #
  7. ChrisHajer
    Member

    http://www.washingtonpost.com/wp-dyn/content/article/2009/11/01/AR2009110101470_pf.html

    You beat me to it. I think that link should work even if you're not a subscriber.

    "CIT said in a statement that its bondholders have overwhelmingly approved a prepackaged reorganization plan which will reduce total debt by $10 billion while allowing the company to continue to do business. "

    and

    "CIT's bankruptcy filing shows $71 billion in finance and leasing assets against total debt of $64.9 billion."

    Posted Sunday Nov 1, 2009 16:28 #
  8. spatny
    Member

    More on CIT:
    (Most bondholders will also end up with new CIT debt worth about 70% of the face value of their old debt. Preferred shareholders, including the US government, will get money only after other creditors are paid back.
    The government invested $2.33bn in CIT shares in December 2008 through the Troubled Asset Relief Programme (Tarp). It could have lost more, however, had it not declined to give more aid this year.
    "The decision to proceed with our plan of reorganisation will allow CIT to continue to provide funding to our small business and middle market customers, two sectors that remain vitally important to the US economy," said CIT's chairman and CEO, Jeffrey Peek, who will step down by the end of the year.
    CIT's bankruptcy protection filing, showing $71bn in finance and leasing assets against total debt of $64.9bn, is one of the biggest in US corporate history.)

    Fifth largest BK in U.S. history.

    Posted Sunday Nov 1, 2009 17:03 #
  9. spatny
    Member

    Nine banks were closed on Friday - some very big ones

    http://www.reuters.com/article/financialsSector/idUSN3039801620091031?pageNumber=2&virtualBrandChannel=11604&sp=true

    (9 Banks You and Your Family are Hopefully Not Banking With
    By Rocky Vega

    11/01/09 Stockholm, Sweden – This weekend nine more banks were seized by the FDIC, the highest number in a single day since the crisis began. There have now been 115 total failures in 2009, the most in 17 years.

    One of the banks, Cal National, is the 4th largest bank failure so far this year. It has 68 branches and ran the kind of operation that sounds like a textbook real estate bubble-serving bank including, “five times as much foreclosed property on its books and twice as many non-current loans as it had a year earlier” and it “lost about $500 million on heavy investments in Fannie Mae and Freddie Mac preferred shares.” It’s a bank that probably didn’t get what it wanted, but pretty much got what it deserved.

    The other banks are:

    * Bank USA, National Association (Arizona)
    * Citizens National Bank (Texas)
    * Community Bank of Lemont (Illinois)
    * Madisonville State Bank (Texas)
    * North Houston Bank (Texas)
    * Pacific National Bank (California)
    * Park National Bank (Illinois)
    * San Diego National Bank (California)

    All nine were held by FBOP Corporation, a multi-bank holding company based in Illinois. Now their combined $18 billion in assets and $15 billion in deposits will be acquired by US Bank NA of Minneapolis, the main subsidiary of US Bancorp.)

    Bad as the banking situation is starting to look, the reality of the housing market - contrary to the recent cheerleading and phony numbers about things getting better - is coming to a boil. Take a look at these numbers...

    http://seekingalpha.com/article/170419-how-bloomberg-fabricates-u-s-housing-numbers?source=article_lb_articles

    If you've recently - last five years - bought a house or obtained a mortgage and you haven't looked at MERS yet you better do so. You may discover that you don't actually own anything, or on the other hand, don't need to pay for it anymore. (I knew that would get your attention. Here's a link:

    http://www.bullionbullscanada.com/index.php?option=com_content&view=article&id=4600:who-owns-foreclosed-us-properties-part-ii-the-role-of-mers&catid=47:us-commentary&Itemid=132

    And consider whether you want to believe the NAR statistics on the housing market "getting better."

    Jeff Nielsen writes:

    "There are two sources for most housing data in the United States. One source is the National Association of Realtors (NAR). Given that this organization represents only people who sell U.S. residential real estate for their livelihood, this is an extremely biased entity – with an obvious agenda. They represent the more reliable source for data.

    The other major source of data is the U.S. government, itself. I have written volumes on the legendary excesses of the U.S. government in manufacturing numbers which are ever-further divorced from the real world. As an example, at the beginning of this year, when the Case-Shiller index was reporting that the collapse in U.S. housing prices had reached their most extreme level (a year-over-year decline of 19%), the U.S. government was reporting that U.S. home prices were rising.

    As with many other U.S. government “statistics”, I now pay absolutely no attention to government housing propaganda. While it is possible to critically analyze mere exaggerations, there is no analytical value to numbers which are simply invented – and in direct contradiction with what is actually happening in markets.

    This leaves the biased NAR as the “best” source for most U.S. housing data. In a report released today, the NAR stated that existing home sales had increased to a level of 5.57 million units – the highest since July 2007, crowed the NAR. That was right about the time that the U.S. housing crash first turned really ugly. However, those days are already long-forgotten by the NAR.

    Lawrence Yun, the giddy “chief economist” of this organization is claiming that U.S. “housing inventories” have now fallen to a level equal to 7.8 months of supply – and a supposed 15% decline from just the beginning of this year....

    "To my regular readers, I apologize for the continual need to repeat much of this analysis. However, as I have observed before, there is only one way to counter a relentless campaign of propaganda – through continued repetition of facts.

    Stay focused on the “big picture” and do not allow yourself to be deceived by either fraudulent “statistics”, absurd “spin”, or the occasional, positive “blip” in this market. In even the worst crashes, nothing goes down in a straight line. Given that the U.S. experienced a collapse in its housing market more than three times worse than the worst year of the Great Depression (based on data from the highly respected housing economist Robert Shiller), a “dead-cat bounce” for this market was overdue.

    At best, this lull in “the eye of the hurricane” will last to the end of this year. Early next year, the new spike in mortgage-resets will begin. At that point, U.S. banks (who have up until now totally ignored this oncoming disaster) will have to confront this next crisis – which will most likely be characterized by the U.S. media as a “surprise”.

    By this point in time, there can be no excuse for responsible adults to be “surprised” by developments in the U.S. economy. The same fools and shills who were “pumping” U.S. markets and the U.S. economy at the peak of the U.S. bubble (and Wall Street Ponzi-scheme) are pumping again. Meanwhile the fundamentals for the U.S. economy continue to deteriorate.

    It is only the fact that the U.S. government pretends there is no inflation in the U.S. economy which allows it to pretend that some aspects of the U.S. economy are experiencing a tiny improvement. Even then, most of the statistics it spews are not improvements but simply a reduction in the rate of collapse.

    The U.S. propaganda-machine has completely erased this important logical distinction. When the Titanic had already taken on almost enough water to drag it to the bottom of the Atlantic, would rational passengers on that doomed ship really be encouraged to hear that the ship was “only” taking on water at a slower rate - simply because most of the ship was already water-logged?

    Here's the link for the complete article:

    http://www.bullionbullscanada.com/index.php?option=com_content&view=article&id=4537:fantasy-housing-numbers-a-prelude-for-next-us-crash&catid=47:us-commentary&Itemid=132

    And then there is the reset spike for ARMs,the commercial real estate bubble, the forecast for poor sales this holidday season that will force many small businesses to tank, and let'snot forget the 60 TRILLION in credit default swaps that still need to be cleared. Nobody even knows who owns those by now. Whoopee - 2010, here we come!

    Posted Sunday Nov 1, 2009 17:09 #
  10. spatny
    Member

    Just to keep you awake a bit longer, here's a little explanation of how the Banksters used MERS and CDSs to sink the world economy. This is the $60 TRILLION problem that still remains to be dealt with.

    http://www.bullionbullscanada.com/index.php?option=com_content&view=article&id=4539:who-owns-foreclosed-us-properties-part-i-scam-in-the-making&catid=47:us-commentary&Itemid=132

    Posted Sunday Nov 1, 2009 17:55 #

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