Sunday, February 13, 2011

Keepin' em' honest.

A couple of local media stories that raised my eyebrows.

First a "things are looking up" story from John Stearns in today's Bulletin, "Bank Back to Playing Offense."

Says Patricia Moss, CEO of Cascade Bancorp: "Now we're actively calling on businesses and saying, 'If you have a need for the dollars and ability to repay, we're here to do small business lending..."

On the other hand: Later in the story: "But many small businesses are struggling with the economy and won't qualify, Moss said."

O.K. Fair enough. Basically, they'll loan to any business that doesn't actually need a loan, and won't loan to any business that actually does need a loan.

Business as usual.

But it's the gray area in-between that really counts. The businesses where it might be a small risk to loan to, but which have potential. But business that could really spring to life with an infusion of cash.

I have no way of knowing if Bank of the Cascades is loaning to this middle zone: but I suspect not.


The last Cascade Business News was a whopper.

Usually I leave this 'newspaper' alone. It does what it does -- promote local businesses with feel good stories, boosting the prospects, being your basic Babbitt.

Again, fair enough. I suppose someone has to do it.

But this last issue went a little beyond that.

The local business community brought in an outside speaker to a conclave and asked him for his honest opinion about the local economy.

Here's what Economist Bill Watkins said, "Three years after the beginning of the recession, and a year after the end of the recession, Central Oregon's economic prospects are distressingly dismal, characterized as they are by continued job losses, still-declining real estate prices, negative net migration and economic growth so weak as to be barely measurable."

"....distressingly dismal...."

The CBN's response was to line up 50 businesses and a bunch of local to contradict that statement.

To me, this is intellectually dubious.

Starting with Pamela Hulse Andrew's editorial: "Taking Issue with Gloomy Economic Predictions." (It's fair to point 0ut, the Ms. Andrew's recently declared personal bankruptcy.)

Most of the other "coaches and consultant" quoted in the paper were to my mind equally dubious.

I personally don't think the economy in Bend "is getting better" and I think that saying so, and especially doing everything you can to try to drown out a objective third party who you asked their honest opinion from, is just boosterism gone wild.


H. Bruce Miller said...

I give CBN credit for publishing the negative (realistic) comments of the impartial analyst in the first place. But 50 rebuttals from "coaches and consultants" does seem like overkill. Methinks CBN doth protest too much.

Anonymous said...

Yes CBN its good to have printed the negatives, but then the long winded would have no justification to let the gilded 50 proclaim that Bend bubble 3 has begun, ... we're now at the sorry state that only outsiders can truly judge Bend for what it is, and I suspect the 50 that boosted Bend are the only audience left that even reads CBN, today Bend is truly a hollow vacuum. A rotting carcass just waiting for some vulture to swoop in and finish the nasty job, and give these last 50 the necessary 'kick in the ass' to get on with their life. That said I know all too well of the '50', as I have many friends in Bend now sitting in $5M homes now worth $500k, and they're all going to sit and wait until they can get their money back ( $4m ) ... as we all know this game was played by the rich post 1932, and most that played lost their ass, the maintenance in the desert is what kills you, ... its one thing to walk when the bank owns the house, another when you paid cash, e.g. your life savings are invested in a sunken ship, and you wait on the sea in a dinghy for the ship to rise on its own, ... people tend to perish slow and miserable lives playing this game. This is Bend, a death of a 1,000 slow slashes.

Anonymous said...

HBM you finally decided to post a real picture of yourself?

Anonymous said...

Wow, Buster is back!

Anonymous said...

Ya back, now is the hot season here in Malay, back in Bend for 2-3 months, do to some spring cleaning, and opt-out of the hot season in Malay. Not much left to wind down down, completely un-would. Just need to get some shit into 'longterm storage', ... Living in a tropical climate and swimming and running everyday outdoors at 4am on the beach has made me 20 years younger.
Well EVERYTHING we predicted back in 2007 has come to fold in Bend as I fought long and hard prices would fall below 4X income, and they have the medians is now well below or around $160k (Bend family income assumption $40k/yr), and it will fall even more.
Things that people need like fuel & food will sky rocket, things that people don't need like cars and homes will become worthless. Where to keep your money now? Anywhere but the USA.
Why did I move? Smart jews didn't wait until post 1933 to leave Europe, you wait too long and the exit gate is closed, I wanted to be completely setup and content before the gates are shut and locked, I foresee the future years in the USA as being a hell on earth, albeit Bend might be better than Detroit, that is like saying that dog-shit is better than pig-shit. Living in shit, is living in shit.
In Malaya I eat fruit, and sleep with beautiful young women, thanks you all can have the USA, and wallow in each others shit. The USA and all its citizens deserve one another, what you sow so shall ye reap.

Anonymous said...

Yep, that be Buster all right.

Anonymous said...

The USA is now in a depression that will make the last depression 1929-1942 look short&sweet, the fact is the USA was rich in 1932 in gold, oil, and trees, now the USA is an exhausted plantation colony, ... essentially the USA is returning to its former status as a prison colony for the world, ... get out while you can.

Call me wrong if you wish, you all called me wrong back in 2007, and most of what me & homer predicted is/was spot on. Don't suggest to wish it isn't so, none of us are in control of the greed and stupidity that is MOSS&BEND-INC. Note that MOSS is being kept alive on printed money just fine, ... and quite indicative that those that deserve to go down the most, will be taken care of to the last, and those that need the most will never see a fucking grain of rice.
Pre civil war the USA like Australia was where everyone liked to send their convicts to enjoy slave labor in the 'colonys'. The USA don't make shit anymore, and perhaps in the midwest when this is all over and peak-oil has passed the USA will once again provide food for the world, albeit without CORP-AG, but one thing is clear that the hordes that don't die in the coming civil war, will slowly migrate to where the food and slaves can be found.

End of the world? Fuck no? Conspiracy? Nope, ... Just a simple case of a nation of kleptocratic parasites having fucked the world for 50 years, and now the world has said enough. The days of the US empire keeping a NUKE GUN to the worlds head and forcing the USDollar up their ass is BEND-OVER.

Bend Economy Man said...

I think that the rebuttals of "The 50" are harmless. In 2005-2006, all the boosterism was dangerous because people listened to it, or at least it seemed to be true.

The boom was a "positive feedback loop": people talked Bend up, people invested, people made money, which made people talk Bend up even more.

Starting in late 2005, folks like myself were blogging about the RE bubble, but the negative information was not enough to drown out the "reality" people were seeing every day -- that Bend real estate was a sure thing.

The bust is a "negative feedback loop" which can't be broken by some small-time businesspeople. And if for some reason, anyone were to listen to "The 50" and invest in Bend, it's a horrible time to invest in Bend so the investor would lose money, thus making sure that local business leaders have even less credibility when trying to attract investment.

There are hundreds of towns all over the country, nay, the world, that are hurting economically right now. There are millions of units of real estate for sale, and millions more waiting in the wings for "when the market picks up."

There is nothing that anyone in Bend can do or say right now to bring back a real estate boom. "The 50" are completely harmless.