U.S. CitiesCity-Data Forum Index
Covid-19 Information Page
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 12-22-2008, 08:05 AM
 
26,661 posts, read 40,594,954 times
Reputation: 14759

Advertisements

http://www.marketwatch.com/news/story/US-developers-look-a-bailout/story.aspx?guid={B3728153-D510-427B-871C-EC18F23E4FBA}

Some of the nation's biggest property developers are asking the government for assistance as a record amount of commercial real-estate debt comes due, according to a report in The Wall Street Journal on Monday. The industry is reportedly asking to be included in a new $200 billion loan program initially created by the government to assist the market for student loans, car loans and credit-card debt. The industry is warning that thousands of office complexes, hotels, shopping centers and other commercial buildings are headed for defaults, foreclosures and bankruptcies, owing to some $530 million of commercial mortgages that will be coming due for refinancing in the next three years. They say that this poses another major threat to the global financial system, already severely weakened. In a recent letter to Henry Paulson, signed by a dozen real-estate trade groups, the scenario was described as grim. "Right now, we believe there is insufficient systemic capacity to refinance expiring, performing commercial real-estate loans. For many borrowers, [credit] simply is not available."



So this is the next group asking for money....who will be next in line!
Reply With Quote Quick reply to this message

 
Old 12-22-2008, 08:43 AM
 
Location: Great State of Texas
86,068 posts, read 74,672,087 times
Reputation: 27602
I just read that myself in another article:

Developers Ask U.S. for Bailout as Massive Debt Looms - WSJ.com


I would imagine there will be a huge flight of every/any industry execs to Washington to get in line for the free money. Who in their right mind would not go get a few billion with no strings attached ?

So, on the front end they are begging for money. On the backend they are asking Congress if they can skip funding their pensions.

And we're just in a recession here ? Me thinks we're in a depression but the numbers are too fluffed up to confirm that.
Reply With Quote Quick reply to this message
 
Old 12-22-2008, 08:58 AM
 
12,869 posts, read 13,426,636 times
Reputation: 4453
this is a little long but excellent simplified reading:
FREE TRADE IS VERY EXPENSIVE TO MAINTAIN « Culture of Life News:
International trade was collapsed into the same hole dug by the Japanese ZIRP system. As I predicted several years ago, all the top G12 nations would all emulate the Japanese depression since they all rewarded Japan for this ZIRPiness. Namely, Japan’s export powers grew swiftly and Japanese export corporations ruled the roost. Anyone who didn’t protect themselves from the flood of Japanese exports saw their own industrial base decline or even be nearly eliminated. And the Chinese were the very first to successfully imitate the Japanese system. Except, to keep peace with the US and EU, they let the yuan get stronger which was a mistake.

Last edited by floridasandy; 12-22-2008 at 09:18 AM..
Reply With Quote Quick reply to this message
 
Old 12-22-2008, 09:01 AM
 
4,570 posts, read 6,692,483 times
Reputation: 2571
I ask myself "why should we give them the money". Eventually, they are going to be asking for more loans. Not only that, but the company will be in a BIGGER debt than they were before they asked for the bailout. Just file for Chapter 11 bankruptcy protection, and reconstruct the company. Just look at Delta.
Reply With Quote Quick reply to this message
 
Old 12-22-2008, 09:29 AM
 
48,509 posts, read 86,101,401 times
Reputation: 18105
Once you open the door ;all the beggers come right on in there corporate jets.
Reply With Quote Quick reply to this message
 
Old 12-22-2008, 09:59 AM
 
Location: Wouldn't you like to know?
9,114 posts, read 15,954,234 times
Reputation: 3698
When does it stop?
Reply With Quote Quick reply to this message
 
Old 12-22-2008, 10:13 AM
 
Location: Great State of Texas
86,068 posts, read 74,672,087 times
Reputation: 27602
Quote:
Originally Posted by CouponJack View Post
When does it stop?
When the printing press breaks down and replacement parts cannot be found because the factory in China that made them was burned to the ground due to riots because the economy over there is in shambles.
Reply With Quote Quick reply to this message
 
Old 12-23-2008, 01:36 PM
 
Location: Charlotte, NC, USA
392 posts, read 1,338,984 times
Reputation: 260
Quote:
Originally Posted by bentlebee View Post
http://www.marketwatch.com/news/story/US-developers-look-a-bailout/story.aspx?guid={B3728153-D510-427B-871C-EC18F23E4FBA}

Some of the nation's biggest property developers are asking the government for assistance as a record amount of commercial real-estate debt comes due, according to a report in The Wall Street Journal on Monday. The industry is reportedly asking to be included in a new $200 billion loan program initially created by the government to assist the market for student loans, car loans and credit-card debt. The industry is warning that thousands of office complexes, hotels, shopping centers and other commercial buildings are headed for defaults, foreclosures and bankruptcies, owing to some $530 million of commercial mortgages that will be coming due for refinancing in the next three years. They say that this poses another major threat to the global financial system, already severely weakened. In a recent letter to Henry Paulson, signed by a dozen real-estate trade groups, the scenario was described as grim. "Right now, we believe there is insufficient systemic capacity to refinance expiring, performing commercial real-estate loans. For many borrowers, [credit] simply is not available."



So this is the next group asking for money....who will be next in line!

We've had easy credit and inflation for so long that it seems as if nobody has a plan to handle deflation or tight credit. Everbody seems to have assumed that property values will always increase, and that they will always be able to refinance thanks to easy money. I assume these companies don't have the cash to pay down these debts that are coming due.

It seems as if our money system only works in one environment, an inflationary one. Once things swing into reverse, even if it is just for a little while, the machine jams up. It will stay jammed until enough of the excess, upside-down debt is removed from the system, one way or another. Then, the money system can move forward once again.

Hopefully the credit markets will loosen up by the time these loans come due. If not, then the feds will have to get behind the commercial loan market, providing a source of credit, just as they do with Fannie/Freddie.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2020, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top