Durango Unemployment Less Than Most Western Mountain Towns (Boulder, Alamosa: ski resort, apartment)

[NomadicBear]

Originally Posted by CAVA1990

Incline will come back in 2-3 years. I'm not denying prices have fallen. I've just seen over and over, the same thing. Every 10-15 years there's a recession and prices fall, followed by a period of price stability (growth with inflation), followed by rapid escalation. The same cycle plays over and over and over again. I don't buy your "sky is falling, this time it's different theory".

Go back and study your history. It will give you a good idea of what I'm talking about.

It's very clear you have absolutely zero understanding of the market forces at work. You make no coherent arguments, whatsoever. If you were such a student of history, you would understand we are in uncharted waters, and that there is no historical basis for which to compare the current situation to. There simply has never been a housing or credit bubble on this scale.

[CAVA1990]

Originally Posted by NomadicBear

It's very clear you have absolutely zero understanding of the market forces at work. You make no coherent arguments, whatsoever. If you were such a student of history, you would understand we are in uncharted waters, and that there is no historical basis for which to compare the current situation to. There simply has never been a housing or credit bubble on this scale.

Sure there has - 1893, 1907, 1930s. More recently in California, the Aerospace crash of the 1970s. Since then there were a couple of others in the 80s and 90s as I recall. The cycle repeats.

I posted a question over on the Nevada forum about Incline Village. Will be interested to see what the locals think. Keep in mind a lot of the short term price declines you're seeing are due to foreclosure and short sales. When these flush out of the system over the next couple years, you'll see selling prices rise and more closely track with listing prices.

[jazzlover]

Originally Posted by CAVA1990

Sure there has - 1893, 1907, 1930s. More recently in California, the Aerospace crash of the 1970s. Since then there were a couple of others in the 80s and 90s as I recall. The cycle repeats.

I posted a question over on the Nevada forum about Incline Village. Will be interested to see what the locals think. Keep in mind a lot of the short term price declines you're seeing are due to foreclosure and short sales. When these flush out of the system over the next couple years, you'll see selling prices rise and more closely track with listing prices.

I have to disagree with this to some extent. There indeed have been many very serious "busts"--both nationally and in Colorado--over the past century or better. But I do think that we are in some very uncharted waters now, and the ultimate outcome of that may be much more prolonged and deep economic (and social) distress than most people are ready to admit--or accept. Why? Because we are becoming in embroiled in a near-perfect economic storm that is far beyond just the bursting of a huge economic bubble--and the plenty severe repercussions from that. We are also in a fundamental shift in the United States from an era--beginning with the inception of the country--when the limiting factors in economic health were a limited labor supply and periodic capital deficiencies, but with abundant natural resources to a country with a soon-to-be oversupply of labor (with chronic unemployment and underemployment), serious long-lasting capital deficiencies, and very constrained, increasingly expensive and diminishing natural resources. That is a totally new economic paradigm that neither the business and government institutions of the US nor the general population of this country are equipped to handle. The result will be a drastic and potentially violent re-ordering of the economic strata in this country and people and places heavily dependent on the old paradigm--and Durango is one--are not going to fare very well.

I think one very true parallel between this economic meltdown and the Silver Panic of 1893 will be the recovery time--I don't think a half-century timeframe to recover to anything even remotely resembling where we were a few years ago is an unreasonable assumption at all.

[NomadicBear]

States from an era--beginning with the inception of the country--when the limiting factors in economic health were a limited labor supply and periodic capital deficiencies, but with abundant natural resources to a country with a soon-to-be oversupply of labor (with chronic unemployment and underemployment), serious long-lasting capital deficiencies, and very constrained, increasingly expensive and diminishing natural resources.

The extraordinarily high unemployment coupled with declining wages, alone, will drive real estate prices into the ground. You can't have high prices with no fundamental support. Many areas, like some in NV, are finding that people just up and move. Demand for houses is shrinking violently. "Investors" in the low end are driving the foreclosure sales, and are quickly realizing that there is little demand for their rentals, recently purchased with the intent of "holding until the market turns around." I've got news: the market isn't going to "turn around." The mistake people have made, and continue to make, is assuming the problems in this economy are just temporary- collateral damage from the effects of the credit bubble bursting. Unfortunately for them, they're terribly mistaken. The problems are structural. Like jazzlover has illustrated, we're entering a new paradigm as far as the economy in this country is concerned.

[CAVA1990]

The problem with your theories is that you're looking at the world the way it is now, not how it will be in the future, which is coming faster and faster with the ever quickening pace of technological innovation. I remember folks espousing similar doom and gloom back in the 70s when the aerospace industry in California collapsed.

None of us has any idea what's around the corner that will drive consumer demand. Ten years ago we had no concept how the internet would revolutionize the economy. I just don't share your Malthusian view that we're on an intractable downward spiral.

I'd appreiciate it if we can keep the dialog civil. I may not agree with you on thisi but I do respect your opinions.

[jazzlover]

Originally Posted by CAVA1990

The problem with your theories is that you're looking at the world the way it is now, not how it will be in the future, which is coming faster and faster with the ever quickening pace of technological innovation. I remember folks espousing similar doom and gloom back in the 70s when the aerospace industry in California collapsed.

None of us has any idea what's around the corner that will drive consumer demand. Ten years ago we had no concept how the internet would revolutionize the economy. I just don't share your Malthusian view that we're on an intractable downward spiral.

I'd appreiciate it if we can keep the dialog civil. I may not agree with you on thisi but I do respect your opinions.

Here is some things to think about: A family friend who was a prominent Rocky Mountain petroleum engineer explained "Peak Oil" and King Hubbert's prognostications about it to me when I was a wet-behind-the-ears high school kid in 1969. Nearly everything he explained four decades ago has come true--just about on schedule.

My own father, a mechanical engineer with a few patents of his own, predicted in the early 1970's that we would be facing serious problems by early in the 21st century because--counter to a lot of pie-eyed optimists back then--we were not going to be able to develop an alternative to the internal combustion engine before we depleted our cheap petroleum reserves. Well, damn, look at where we are now.

I joined Zero Population Growth back in the early 1970's, because it was readily apparent to me that overpopulation would--within my lifetime--overwhelm our technology's ability to stay ahead of exploding population's demand on resources, ecosystems, and the socio-economic fabric of this country and of the world.

You are right, things in the world are moving faster and faster. Unfortunately, what is moving fastest of all is the plethora of huge, nearly intractable problems confronting us as a state, country, and species. That is increasingly moving faster than our ability to craft solutions that do not create more problems than they solve. What has not progressed much at all is our more base instincts and vices. Those are every bit as flawed and dangerous as ever, only now we have the technology to use them to "act out" in most catastrophic high style. In such an environment, one of the first signs of tragic decay is the decline of civility. I would defy anyone to say that this country is not seeing that right now.

[CAVA1990]

Originally Posted by jazzlover

In such an environment, one of the first signs of tragic decay is the decline of civility. I would defy anyone to say that this country is not seeing that right now.

Amen to that. Unfortunately technology, through the internet, has amplified our non-civility.

[POhdNcrzy]

Nice thread here. No one has mentioned the fact that the US pop. has grown by about 20-30 million just in the last 15 years or so. I can't see housing prices going down too much more just because of the population related demand pull. Similarly, those expecting crashing stock markets and doom may be disappointed if perhaps the "funny money" system actually just keeps on going.

Do all the extra people help stabilize and grow local economies?

But if the environment is truly deflationary and recessionary, don't all these extra hordes of people become a rather noisy burden?

I would suggest taking the unemployment numbers with a grain of salt. Durango has a rather small population so any statistical generalities are gonna be dubious.

By the way, Colorado and places like Durango are really nice. Americans have been fleeing to the "nice places" for centuries. I'm not sure even another Great Depression could throw that train off the tracks!

[jazzlover]

Originally Posted by POhdNcrzy

Nice thread here. No one has mentioned the fact that the US pop. has grown by about 20-30 million just in the last 15 years or so. I can't see housing prices going down too much more just because of the population related demand pull. Similarly, those expecting crashing stock markets and doom may be disappointed if perhaps the "funny money" system actually just keeps on going.

Do all the extra people help stabilize and grow local economies?

But if the environment is truly deflationary and recessionary, don't all these extra hordes of people become a rather noisy burden?

I would suggest taking the unemployment numbers with a grain of salt. Durango has a rather small population so any statistical generalities are gonna be dubious.

By the way, Colorado and places like Durango are really nice. Americans have been fleeing to the "nice places" for centuries. I'm not sure even another Great Depression could throw that train off the tracks!

Colorado was a "nice place" in 1892. Then the crash hit, and Colorado basically stagnated for decades. Don't think that it can't happen again.

Also, just because the population increases doesn't mean those people can afford anything. In fact, just the opposite is happening now. When population growth outstrips resources, things become less and less affordable to the general population. We've done our best in this state and this country to cover up that nasty little fact by borrowing against and leveraging every single thing in the country--including our currency and national sovereignty--right up to the hilt. But that can't go on forever, and it won't. And when it comes crashing down to earth--and that is beginning now--we are going to find out just how much stuff that we really couldn't afford. One of things that we will see is a massive consolidation in households--just as it happened in the Great Depression. We won't need to build any more sprawl s*** for decades--and that is not a bad thing in my book.

[NomadicBear]

Population growth is irrelevant to house prices. Median incomes are the driver. If you have one million people earning $30k per year, and one million houses for sale priced at $500k, you're not going to sell a single house. There is no market for the glut of high priced houses in this country.