My original plans were to keep on expanding my inventory and diversity through June of 2006, and then just maintaining. Instead, I got caught up in the idea of carrying new books and board games (having heard that Gambit was probably going to close.)

I continued to grow through the first three months of 2007, then tried to squeeze out the excess in the second quarter. Then my plan was to maintain whatever level I reached by July, 2007.

Still, I've allowed myself some flexibility. I've allowed myself to buy anything that I think will sell. I've replaced most of what has sold. So, I'm still probably spending more than I should.

At the end of summer, I cut back on my pre-orders, as I've said, but kept my reorders high.

Now, I'm even rethinking that.

Watching Brooks Resources bail on their projects, putting them in hibernation, has spurred me to rethink it yet again.

You have to realize, probably 80 to 90% of locals have never been through a downturn in Bend. Maybe even more than that many businesses have never been through it.

I have. I have no excuses not to react to my experience and instincts.

Brooks Resources has also been through this before. My exposure is nowhere near what theirs is, I'm just a tiny little business, but it wouldn't take as much to hurt me either.

I'm going to keep my budget at current levels through Christmas, but I'm also going to be watching Brooks Resource's moves. Because I figure they have a much larger pool of data than I do. For them to be reacting the way they are, they have probably been feeling it for six months or a year, been planning how to deal with it for a few months, and are going ahead because they've got enough reservations about the future -- and enough experience of the past -- to make the moves now.

Either they are smarter than everyone else, have more information and experiences than everyone else, are more decisive than everyone else -- or they're more desperate. Either way, it's an interesting wrinkle.

My guess is that they have ways of putting projects to sleep; put the project manager on half time through the end of the year, quit building anything that isn't pre-bought, let go the extra staff at the real estate offices, unload any properties that they aren't committed to, and so on. Their actual exposure may not be as bad as it looks. They owned the land already, afterall.

It may be they are sitting on a pile of cash, and can wait 18 or 24 months and buy back all the land they want.

Or maybe they're really hurting. Hard to know.

I think they understand though that the actual circumstances are more important than Bullshit P.R. That's a major difference between them and just about everyone else. Sure, Hollern says something about 'real' houses (what with him and the word real?) are selling to real people. But it's a bit of a fig leaf.

At this point, I don't think they care how it looks, because they know there is so much fluff and exuberance still in the market to get away with it. Believe it or not, from what I observe and hear at the store, the sentiment still hasn't turned negative, just slightly concerned.

I'm in a bit of the same position -- as long as everyone else is still thinking its a cold, I can bundle up and try to avoid pneumonia.

I've already cut my future exposure. The only question I have to deal with, really, is whether I should be cutting further my current exposure.