How is Your (Holiday) Economy Doing?

I’m a bit surprised that anyone can be surprised by the lousy jobs numbers for August. Consumers are worried and too many economists have been trying to draw trend lines through noise in retail spending data and call it proof that a recovery in under way. Broad measures of unemployment are stuck in the upper teens, big companies are continuing to shed jobs, small businesses on the whole are pessimistic, state budgets are under pressure and federal deficit spending is set to be reined in. With housing in most markets not having bottomed, the overwhelming majority of consumers having taking a wealth hit, businesses not investing and government not taking up the slack, where exactly is growth supposed to come from? The tooth fairy?

The government and private sector confidence generation apparatus hasn’t made much headway against the ugly combination of a post financial crisis hangover (known more formally as a balance sheet recession) and poor policy responses (yes, Virginia, while the authorities did keep the financial system from imploding, the failure to clean it up and provide for adequate stimulus to offset private sector deleveraging were and continue to be massive errors).

But why has the media been so clueless? Cynics might argue that they are paid to be clueless, and there is more than a bit of truth in that. However, I suspect at least as powerful is that the overwhelming majority of reporters live in New York or Washington DC, two cities relatively unaffected by the downturn. DC is awash in lobbyist dollars and New York has been kept afloat by super low interest rates and other sops to the banks.

While readers provide some vignettes on how the rest of the country is faring, I got a real wake up here in central Maine. Even though yours truly has a bias to see the glass as half empty rather than half full, things here are visibly worse than in the last two years, meaning in the wake of the crisis.

I’ve gone to the Casco Bay area (Portland is at the south end of Cacso Bay) around this time of year for over 20 years, including the particularly bad 1990-1991 recession, which seemed to hit this economy harder than most of the US. Some indicators:

1. The roads are just not busy enough. We rent a house in a major vacation area. The traffic level is notably lighter than in the past. We expected to see this in 2008 or 2009 and didn’t much then.

2. Normally we avoid Freeport entirely till after Labor Day. Freeport is the home of LL Bean and has become a America shopping town of sorts, with lots of aspirational middle class outlet stores (Calvin Klein, Nike, J. Crew) and is typically mobbed in the summer and still pretty busy right after Labor Day. One of my relatives was in desperate need of a book fix, so mid-week we relented and went to a used book store on the edge of Freeport and could tell the roads in and out were way underpopulated relative to the norm. We decided to venture in today so the nieces could shop, and Freeport was a ghost town.

3. We always go further up the coast to Boothbay Harbor, and often take a cruise. There were notably fewer options on offer. Again, this is one of the biggest weeks of the year, and suggests the tour operators have cut back their schedules from past years.

And consider this too: given the strength of the Canadian dollar, you’d expect Canadians coming to the US to be a partial offset to any fall in domestic holiday spending.

I hope readers will give me their observations about how the economy is faring, both based on activity where they live, and for those who have gone on holiday in the US in the last month, what you’ve observed elsewhere.

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  1. John Wessel

    I live in a 100,000 person bubble of affluence in southern California: Ventura. Things have not changed very much. If anything, the city bustles more than it used to. We have a pretty diversified economy of tourism, agriculture, medicine, education and government. Rents have fallen 10% or so and of course home prices are way down. The biggest struggle seems to be among the young people who have very little luck finding employment outside of waiting tables.

    1. Linus Huber

      Good link. Taleb says what I have been preaching for a while now. The only thing he does not consider in resolving the problem is the idea to make bankers personally accountable.

      If an entrepreneur makes makes a killing, I am all for it as he also can face personal losses. However, bankers are basically simply employees who enrich themselves without real downside risk. In my vocabulary, this is plain and simple theft. And as long as bankers can walk away with their pockets full of ill-obtained benefits, they will not stop doing it again and again, no matter what the regulations are.

      1. PaulArt

        “We don’t believe that regulation is a panacea for this state of affairs. The largest, most sophisticated banks have become expert at remaining one step ahead of regulators” – Taleb. Its amazing that someone as erudite as Taleb would make this statement. Its akin to saying that investing in Fire Hoses is a waste of time because the pyromaniac will anyway start fires elsewhere. Inherent also in this idiotic statement of Taleb’s is the glaring ignorance of how we benefited for 40 years and more from Glass-Steagall. Its ideology pure and simple. Anything that’s a matter of the State shall be dumped and therefore any and all regulation is a waste. What exactly is Taleb looking for? Some kind of Free Market Utopia? How dumb is that?

        1. Goin' South

          Taleb is simply telling the truth. Regulating Capitalism is like putting a serial killer under house arrest. They will always find a way to rid themselves of any truly onerous regulation: buying the bureaucrats; buying elections; buying politicians; buying lots and lots of lawyers; and buying judges. We’ve seen bankers employ all of these methods successfully over the past two decades.

          Attack causes, not symptoms. Capitalism is the problem.

          1. cwaltz

            What we have isn’t capitalism though. In capitalism, you have a fair exchange where labor and resource market SHARE the benefits of increased production and profitability. That isn’t what has been occuring though. Despite increased productivity we saw real dollar value of wages decrease, only CEO compensation seemed to increase. What we have is more akin to 16th century mercantilism. Only instead of “winners” we have “savvy businessmen.” The rest of us “losers” get to be exploited just like the rest of the third world not engaged in “capitalism.”

          2. JimS

            cwaltz writes: “In capitalism, you have a fair exchange where labor and resource market SHARE the benefits of increased production and profitability.”

            Which economist’s concept of capitalism was that? Not doubting you, just interested in putting a name to the concept. In every concept of capitalism I’m familiar with, the only way for labor to share profit is by being in short supply (either naturally or, via unions, artificially) or by law. Where labor is plentiful and unprotected, it gets what keeps it alive, and not a penny more.

            (example: the impetus for repeal of the Corn Laws was capitalists, who didn’t like paying the wages needed to buy expensive bread for the benefit of landholders. It was understood that the first thing capitalists would do if bread was cheaper would be to cut wages. The worker had no stake in the Corn Laws either way)

        2. Capo Regime

          What? A statement of reality is idiotic–actually using ad hominum attacks ona person or idea is a sign of idiocy.

          It is a fact that the banks are in fact several steps ahead of the regulators. It is a fact that regulatory and prosecutorial agencies are captured by the bank interests. Have you been reading this blog? Have you been awake for the last 5 years?

          1. Capo Regime

            Pauk Art

            Not utopia what sensible people like taleb seek is to stop subsidizing the banks behavior–i.e. back stop them and make then a no loose skiming maching. More banking regulation like Frank Dodd is not the solution is it? Yes, is the banks did face the free market and suffered for their idiocy it would be a distinct improvement for everybody including the tax payer. Again, have you been reading this blog? Have you been paying attention?

            Of course the other part of our nations problems is reading comprehension, critical thinking, jumping to conclusions.

          2. Yves Smith Post author

            With all due respect, you folks RELLY REALLY have it backwards and have indeed been indoctrinated.

            Banks get ahead of regulators because they allow it, period.

            A regulotor could easily take the position that anything that is not permitted is forbidden, and that includes anything they don’t understand. But regulators in the US have become advocates for bank and take the view that they should not to interfere with business’s imperial right to profit, even when, as we discussed, financial firms are so heavily subsidized as to not be private entities by any sensible definition.

            And major banks can’t decamp to Lahore. The threat that they’ll go to the Caymans or someplace friendlier is also a joke.

            First, a major bank needs to be backstopped by a reasonably large nation, otherwise no one will take the counterparty risk.

            Second and more important, central banks control the payment systems in their currency. Major banks need direct access to Fedwire; the private systems (Chips, etc) are netting systems, the actual large payments and the end of day settlement go over Fedwire and there is no way for the banks to innovate around that. And it would be uneconomical for a major bank to go through correspondents (I had a major Japanese client look at giving up access to Fedwire in theh 1980s and they concluded it would cost them hundreds of millions of dollars.).

            No major international bank can afford not to have access to Fedwire. The same is true of the ECB’s settlement system. Either central bank could UNILATERALLY impose effective regulation. They don’t want to and have conned you into believing otherwise.

          3. Philip Pilkington

            Yves, I think this is primarily an ideological argument, even when that’s not explicit. When it is explicit it’s generally the Libertopian argument that government cannot get a grasp on the every innovative (slippery?) markets. That’s just nonsense. But when it’s implicit — as in the case of the above argument — it comes across as:

            (a) A distrust that government can do anything positive, a phobia inherited directed from Mr. Reagan himself and, indeed, straight up brainwashing.

            (b) A vague moral imperative to ‘do right’. Once again: brainwashing. This whole crisis has been portrayed as a crisis of morals within the economic system. As if ‘bad folks’ have gotten control. No… regulations have just been butchered. That’s all. That’s what leads to unethical behavior — me and Das are discussing this now for the forthcoming interview…

        3. attempter

          I like this analogy because it makes the issues very clear.

          If a pyromaniac is starting fires, the solution is not to just shoot the pyromaniac. That would be – I don’t know: Too simple? Too straightforward? Too effective?

          No, the solution isn’t to stop him from setting fires. It’s to come up with better ways to fight the fires he sets. It’s to “invest” in fire hoses. The hoses are bought from the pyromaniac himself; that’s part of why he sets the fires. And they’re designed to leak so no water actually reaches the flames. But they will work if you instead pump gasoline through them.

  2. Chris Maas

    Yves, while you aren’t quite in Central Maine (You are in the prosperous Southern part of Maine), you are generally correct. Up here in (the real) Central Maine (three hours from you), it isn’t exactly a ghost town – things were never that good to begin with, but it’s very slow. People just hanging on by their fingernails. Not a lot of hope. Too tired to even be mad at the government. Where is FDR when we need him?

    Since retiring and moving up here from D.C., I’m struck by how much the economy in places like this depends on A) Federal dollars (healthcare, grants, unemployment benefits, etc.) and B)Volunteer work. Without those, our little town of 4,000 would dry up and blow away. I’m also struck by how little people in places like this are aware of that. Thirty years of propaganda has convinced people that “government is the problem” – hence, there is nothing that WE can do about our problems. What a tragedy.

    Thanks for your clear explanation of what’s happening to us. You, Elizabeth Warren and Bernie Sanders (okay, Paul Krugman too), are lights in the dark. Keep up your good work – it’s an inspiration to all of us.

    1. attempter

      Where is FDR when we need him?…You, Elizabeth Warren and Bernie Sanders (okay, Paul Krugman too), are lights in the dark.

      There’s yer problem.

      Thirty years of propaganda has convinced people that “government is the problem” – hence, there is nothing that WE can do about our problems. What a tragedy.

      That’s a truly bizarre non sequitur. It sounds like you truly believe “there is nothing that WE can do about our problems”, thus your yearning for Better Elites, for Leadership as such, and the obsolete “good government” myth.

      Why would anyone who thinks we can solve our own problems and rule ourselves still yearn for these evil things? Government, of course, is a kleptocracy. It’s the aggressor where it comes to all our problems. What’s stopping people from where you are or anywhere else from taking responsibility for ourselves and rebuilding our true economies and communities? Nothing but government: Its thuggery on behalf of property and the feeling of dependency it inculcates. It also actively seeks to destroy self-sufficiency wherever possible. (Another data point: After the floods of the storm, near here in NJ they arrested people for being out on canoes. What the legal offense was remains unclear, but the power offense is obvious: Contempt of “emergency” authoritah, failure to remain meekly in place waiting to be told what to do by our Betters.)

      BTW, if you ever stop to actually read Krugman instead of merely having faith in his fraudulent reputation, you’ll see that he’s a kleptocrat himself, on the side of the banksters.

      1. Tom Key

        Attempter – Although it is admirable that you claim to take responsibility to fend for yourself, you fail to take responsibility as a citizen. Once you do so, in a democratic republic, you OWN the Government, and you can no longer condemn it as some sort of outside “kleptocracy”.

        WE do not steal from you, and WE are tired of being condemned by you. OUR Government is not our enemy, it is US.

        Your condemnation of the police for arresting thieves in canoes stealing from other citizens during a flood speaks volumes.

        1. Foppe

          Oh please. This “everybody is equally guilty” crap was old when Augustine wrote it, and is even older now.

          1. Anonymous Jones

            Well, I don’t necessarily agree with what he said, but he clearly did not say “everybody is equally guilty.” He said that we cannot completely separate ourselves from the society in which we live. Seems like quite a different assertion to me. Overall assessments of “guilt” would, yes, be incredibly foolish, whether it be on an equal basis or otherwise. Guilty and innocent are only rational concepts at a much more granular level (i.e., with respect to specific actions in specific contexts).

            I know this would never happen, but it would be a much more interesting debate here if we attacked what people actually said rather than what we sorta, kinda infer from the words they wrote.

          2. Foppe

            This is all well and good, AJ, but explain to me then how I should read “you OWN the Government, and you can no longer condemn it as some sort of outside “kleptocracy””
            Because it seems to me that he’s basically making the same totalizing mistake that Foucault did, by suggesting that everything that interacts with a system is automatically fully part of it.
            Now, there are of course multiple ways to read “own” (e.g., all US citizens own the White House, but only a few have access rights), but I don’t really see how else to read this capitalized word other than as “you own its mistakes”. (And note that there is no further attempt to nuance or further explain this rather meaningless suggestion.) So while I’m open to alternative readings, I don’t really see one off-hand that makes sense to me. Certainly I could attribute a (better) position to him that he never held in the first place, but what good would that do?

        2. attempter

          Which “thieves” were those? I said paddling canoes, nothing more. Nice reading comprehension.

          And yes indeed, it is your responsibility as a citizen to be able to help yourself and others in a crisis, without waiting to be told what to do by Leaders. Indeed, more and more it will be true that helping ourselves and others will mean evading or defying Fuhrerprinzip, like your beloved police.

          I’m the democratic citizen here. I’m trying to rebuild true communities. You clearly don’t even know the meaning of words like democracy and community, you’re so brainwashed.

          Meanwhile, those like you who want to remain permanently infantile and coddled by your Elite Betters (but really are soon to be smothered in your cribs by them) are the ones refusing to take adult responsibility and become true citizens.

          Tell me. How long do you think humanity’s minority will need to last, before we’ll reach adulthood? How long do you expect this regency of elites to exercise pseudo-sovereignty until the people will be qualified to directly exercise their true sovereignty? What criteria do you demand to see first? How long must this tutelage last?

          I think we know the real answers to those. How long is forever, and when is never. That’s because you’re terminally opposed to true citizenship, and you elementally fear and loathe true democracy.

        3. Blue Merl

          Did you want the cops to shoot the canoe stealers? It is interesting how the cops themselves were doing both stealing and shooting after Katrina. I know what you must be thinking
          “YOU are the Cops, they are YOU, you OWN them, when they beat YOU, that is YOU doing the beating!!” Hmmph!

    2. David

      “Thirty years of propaganda has convinced people that “government is the problem” – hence, there is nothing that WE can do about our problems. What a tragedy.”

      I think it is absolutely unbelievable that the lates round of right-wing propaganda has turned the middle class against the poor and distracted them from the gains that the rich are taking.

      According to the rhetoric, a cut in corporate subsidies or tax breaks (basically welfare for the rich) represents a tax hike and is unacceptable, while a cut in subsidies to the middle and lower class is an entitlement cut and is supposed to stimulate growth!

      Very sad how so many in the middle have been convinced to vote against their own interests.

      1. G Marks

        David – here is the a firsthand account of a family divided. My sisters family are pure “Rush” conservatives. They get nervous in LA because there are so many icky brown people.

        When they almost lost a spec house to the bank [because they had too much equity in it] it was a liberal judge in a liberal city that saved them – accusing Wells Fargo of cherry picking the foreclosures based on equity. [lots of people were renegotiating ostensibly because they had little skin in the game and the banks would have taken a bath]

        This didn’t change their politics. They still identify with multi national corporations and wealth… and disdain icky brown people. Much of Colorado, Wyoming, Utah and Nebraska, Montana share this fear.

        These people will vote R because they fear Democrats. And what did Obama do??? He proved them right with the repeal of DADT, and now the end of deportations of illegals.

        I voted O because I thought he was a reformer. Instead he behaved like a lawn jockey for gays, illegals and rich, without getting any credit for his subservience.

        The cultural right will vote against their economic self interest because they want a homogenous, heterosexual life.

        AND do NOT tell me two gay daddies in the suburbs is the future for homo/heterosexual relations. ALL homosexual celebrations are XXX rated.. AND are not kid friendly.

        DO NOT tell me its just like St. Patricks Day… because it’s not. Now they are pressing for normalization of man boy love – lowering the age of consent etc.. we will see more of their depravity on our streets.

        ANYWAY… people ask HOW could people vote for their economic enemies? Well, we don’t want to pass a lesbian, spread eagle on the sidewalk… feeding spaghetti to her vagina – asking us and our kids to join her for lunch.

        THIS IS STANDARD… not aberrant behavior at these street celebrations.

        1. Debber

          “ALL homosexual celebrations are XXX rated.. AND are not kid friendly.”

          You must be hanging out at ALL the gay celebrations to make such a sweeping judgment. Therefore, I would say you must be gay and very angry about it.

          1. Black Smith

            I took my son to a Gay Pride parade when he was eight. He laughed at the funnily-dressed people. On the way home he asked me how this was different from Mardi Gras. I said it wasn’t.

          2. G Marks

            OMG — every time somebody complains of lascivious gay behavior, they are accused of being gay. Where EVER did that silly assumption gain legs. I have taken more confession from gay men in my life than a pedophile priest.

            I am an observer of the phenomenon of modern day homosexuality and it is NOT about the privacy of ones bedroom. Homosexuality is so much a part of their being that it’s worn literally on their sleeves. And that’s part of the problem.

            Two gay suburban daddies wouldn’t bother me. I am stunned by the exhibitionism of the disorder. AND Yes, it’s a disorder. I’ve known too many, and heard too many confessions and life stories.

            And the kiddie who thought Doo Dah parties were just people ‘dressed up funny’ is, well, a nice sounding story – not unlike the kind of delusions we are speaking of when discussing banks, their behavior, public reputation… and the “reality”.

            ALL homosexual celebrations are xxx rated.. you know it, I know it… and those who haven’t attended, must see one to believe it. The lesbian with the spaghetti was a minor tidbit. The Streets of San Francisco and Pasadena become a horror of public displays the which, most on this board have never seen or imagined. Sado masochism, men spitting semen onto the crowds… some in the crowds opening their mouths, HOPING TO CATCH SOME… My God in heaven, it is NOT two daddies in the suburbs raising their kids “just like the rest of us”.

            I expect the homosexuals to come out of the woodwork to advance their fantasy lifestyles… but take it from one who has seen this up close and personal as a heterosexual grandmother – this is not about parenting, its about recruiting victims, just like in the church.

            Ok, do your worst. I didn’t come here to have it out with the likes of you… but I will if I must. This is a battle against very dark forces and won’t be decided today.

          3. F. Beard

            OMG — every time somebody complains of lascivious gay behavior, they are accused of being gay. G Marks

            Hear! Hear! I am 60 years old and have yet to engage in or desire homosexual activity. Yet I am disgusted by disgusting behavior be it hetero or homo. I guess I’m just latent and it will take another 60 years for the behavior to manifest. :)

            Leave ole G. Marks alone. He dares to speak his mind. How many of you Progressives dare to?

        2. Transgenderism

          “The Illegals, grrr. The Gays, Grrrr!!”
          Let ’em all in, mexicans, mexican penises, gay military members, gay airforce lesbians – get the whole enchilada in their STAT! Save the ditto heads from themselvs.

          1. G Marks

            and don’t misquote me. I said nothing of Mexicans.

            Any time anyone complains of the lascivious twisted behavior of this bunch they pull off their faces and swallow rats whole.

        3. decora

          lol. you started out harshing on Rush dittoheads for being nutty. you end by calling Obama a ‘lawn jockey’ and equating gay rights with NAMBLA.

          if you have a blog, i would love to read it.

          1. G Marks

            ditto heads ARE nutty. And the homosexual agenda is very much alive and advancing the idea of lowering the age of consent.

            Is the average lesbian advocating man boy love? Probably not.

            But they won’t be helping protect our boys from predation either. If I had to wager where their sympathies lie, it wouldn’t be with the grieving parent of a molested little boy.

          2. G Marks

            And LAWN JOCKEY is the least of what he’s been called by people who love the guy.

            That doesn’t make me a racist.. it makes me a very hurt former supporter.

            When you take on the perverts… they, well, pervert things, including your words.

          3. Yves Smith Post author

            G Marks,

            Are you batshit?

            Single women in New York, like it or not, wind up having more and more gay men among their friends as they get older. Women here are weirdly possessive, and any singe woman is assumed to be a predator, so most attached men are allowed to see me only for lunch or at most, drinks.

            As a consultant, I am also hopelessly inquisitive and have interviewed my buddies on quite a few topics, including bathhouse etiquette.

            You seem to think all gay gatherings are sex parties. Sorry, but sex parties, from what I can tell, are discrete events and are known to be sex parties in advance (one host would insist on “interviewing” possible new guests to make sure they were up to his standards).

            Believe it or not, they are also gay men who are into serial monogamy.

        4. Michael Cain

          Lumping purple-trending-blue Colorado in with solid red Utah, Wyoming, and Nebraska is inaccurate. Dems in Colorado hold both US Senate seats, three-of-seven House seats, the Governor’s Office, the State Senate, and failed by one seat (lost by ~200 votes) to hold the State House. Granted, they’re not the kind of Liberal Democrats that win seats in large urban areas of the East and West Coasts, but the question comes down to whether you want to run a big-tent kind of party, or not.

      2. G Marks

        David – here is the a firsthand account of a family divided. My sisters family are pure “Rush” conservatives. They get nervous in LA because there are so many icky brown people.

        When they almost lost a spec house to the bank [because they had too much equity in it] it was a liberal judge in a liberal city that saved them – accusing Wells Fargo of cherry picking the foreclosures based on equity. [lots of people were renegotiating ostensibly because they had little skin in the game and the banks would have taken a bath]

        This didn’t change their politics. They still identify with multi national corporations and wealth… and disdain icky brown people. Much of Colorado, Wyoming, Utah and Nebraska, Montana share this fear.

        These people will vote R because they fear Democrats. And what did Obama do??? He proved them right with the repeal of DADT, and now the end of deportations of illegals.

        I voted O because I thought he was a reformer. Instead he behaved like a lawn jockey for gays, illegals and rich, without getting any credit for his subservience.

        The cultural right will vote against their economic self interest because they want a homogenous, heterosexual life.

        AND do NOT tell me two gay daddies in the suburbs is the future for homo/heterosexual relations. ALL homosexual celebrations are XXX rated.. AND are not kid friendly.

        DO NOT tell me its just like St. Patricks Day… because it’s not. Now they are pressing for normalization of man boy love – lowering the age of consent etc.. we will see more of their depravity on our streets.

        ANYWAY… people ask HOW could people vote for their economic enemies? Well, we don’t want to pass a lesbian, spread eagle on the sidewalk… feeding spaghetti to her vag’na – asking us and our kids to join her for lunch.

        THIS IS STANDARD… not aberrant behavior at these street celebrations.

        1. NaluGirl

          @ G Marks

          You said:
          AND do NOT tell me two gay daddies in the suburbs is the future for homo/heterosexual relations. ALL homosexual celebrations are XXX rated.. AND are not kid friendly.

          That is false. Read this article:

          “Phoenix gay dads adopt, raise 12 happy kids
          Couple wouldn’t give up to adopt, love kids from foster care”

          Read more:

        2. Allison Goldstein

          Just the thought of a wild, publically accessable adult only homo and hetero super-orgy somewhere in hick Missouri gets my guns blazing, just as it does many other people. But if your holiday means you are trying to escape from a debt cage manufactured by Banksters, sex just isn’t a priority at the moment, which ever way you prefer, homo or hetero. Carlin reminded us that there is a big red, white and blue cock that is being shoved up our asses.

    3. Kevin Smith

      You won’t see many Canadians until you can find a way to run your border in a more pleasant customer-friendly way.

      Homeland security both at land borders and at US airports is a deterrent to visitors who can choose where to spend their time and money.

      1. ambrit

        Mr Smith;
        In a rather ‘conspirational’ spirit, (please take it with a grain of nembutal,) I would suggest that such ‘offensive’ and ‘deterrent’ behaviour IS the point of the Homeland Security Thug Fest. Nothing helps build support for extremism like isolation and a vague perception of being patronized and despised. In such litle but cumulative ways, the Security State builds the social framework from which to leap finally from out of normalcy and sanity. Once the people who can afford to travel and vacation get used to the degradation of ‘others’ by the Forces of the State, all bets are off. The State can then oppress the ‘Lower Classes’ as it likes, it will be seen as the new ‘normal.’ Thus do Tyrannys feed and grow. History teaches that most Empires fall and go through a phase of extreme Authoritarianism. Why should we be any different?

  3. Albert W

    Not all of New York is doing well. I live between a very rich area and poverty-stricken area in Brooklyn (between Midwood and East Flatbush). In Flathbush, the last 2 years I have noticed more people walking the street during work hours, significantly more foreclosures, garbage strewn, and a significant increase in crime, drug selling and use. On the other hand, the people in Midwood are buying Porches and another Mercedes, the area is dominated by finance and white shoe lawyers. Granted there are a rise of people foreclosed on, the high earners are receiving huge paychecks relative to 2008.

    Over the summer I visited Portland, Seattle, Austin.

    The rundown: Portland has a diversified well-managed economy based on green, tech, manufacturing, brewing, and services. Regulation that stimulates growth and makes the city a better place to live. What a concept! People can find a job here without too much a problem so long as they are flexible.

    Seattle: Dominated by tech and finance, beyond that the society looks like it’s falling apart. Communities are highly segregated. The city (especially downtown) is crawling with homeless adults and children. Open drug dealing and using and prostitution even in middle class neighborhoods at night. Bloated city government that raises taxes and clashes services to subsidize corruption. Very high unemployment

    Austin: Like Portland minus those cheerful trees but a temperate climate so not as bad as some areas in Texas. Higher unemployment than Portland however, though not as bad as other places. Fantastic music scene too!

    I went to Corpus Christi this summer — oil and natural gas boom keeping contractors busy here but construction sector is decimated. Good employment for skilled workers, abysmal employment for unskilled workers. Overall a nice city with lots of good food that is cheap and safe!

    I also went to Kingsville Texas, typical medium sized town (38,000 previously 200K+) that as collapsed over the decade leaving payday lenders and walmart as the only industry. Decrepit homes abound, extreme poverty, abandoned factories, homes, hospitals, and schools. 80% businesses shut down. Catastophe

    1. Psychoanalystus

      I spent the last 6 months in Texas, and I can assure you that the state is a disaster. There are jobs in the oil industry, but then again, for that you’d have to live in the dump called Houston (which I described below), and breath air that changes odor based on what toxic chemical the Koch brothers choose to illegally release that day. The same goes for the tap water. On top of that, this summer has been the hottest on record, with days as high as 110 degrees Fahrenheit. This whole “Texas Miracle” is complete bullshit that Rick Perry drummed up in anticipation of his presidential bid. Sadly, many people from other parts of the country bought it, and moved to TX, only to settle for jobs paying half of what they’d pay up north. Once again, Texas is a disaster. I am glad to be back in Europe, and I will likely never set foot in Texas again.

    2. attempter

      People can find a job here without too much a problem so long as they are flexible.

      The American Dream!

      Now that’s what I call having aspirations for life, being “flexible” if I want to eat. That’s what I want to teach my kids about the proper limits of life, since after all we do need to have Elites. Right?

      1. Kevin Murphy

        Help me understand what you are trying to say. That it is bad to be flexible? I really don’t see what the original poster said that was so bad.

        1. justanobserver

          flexible is typically a libertarian euphism for taking a job below your educational level, i.e., being underemployed.

          The libertarian paradise means that you work, even if that job can’t put food on the table. The idea is that if your starving and freezing that will motivate you to get a better job.

          1. wunsacon

            We should start calling “libertarians” by more accurate descriptions, either:
            – “propertarian” (because that’s the only “right” they want “big bad government” to enforce) or
            – “plutocrat” (because their support for property rights alone solidifies and exacerbates the problem of concentrated wealth and racism).

        2. attempter

          I’ll add to what the others said that no one should be willing to flex any further until the still perfectly postured criminals have been bent a bit.

          Just as no one should be willing to “sacrifice” one morsel more until the criminals have been made to restitute all they stole.

          I’m very flexible. I’m willing to do whatever I have to do with the materials nature provides to do productive work. There’s just one problem – some gangsters have illicitly hoarded all those materials and are using violence to keep me and the rest of humanity from them.

          And then they tell us we should be “flexible” in submitting to whatever grotesque contortions they wish to force us into.

          Sorry, I don’t see that as real flexibility. I see it as spinelessness.

          And it won’t work to feed us anyway, as is proven by the ever-growing ranks of the hungry.

      2. citalopram

        Same thing with working in a “challenging” and “high-pace” environment: not only can we work for peanuts, but we can acquire stress-related disorders as well.

        Oh, and you better not turn that smile upside down, because if you do we’ll call your contract agency and replace you.

    3. neo-realist

      Interesting to hear about Midwood and East Flatbush–grew up in East Flatbush in the 70’s and 80’s–a working class/lower middle class with many of those problems back then–garbage strewn streets, people hanging out on the streets, drug dealing, etc. It must be in steroid mode now.

      From what I’ve noticed living in Seattle for a couple of decades is that it is a two trick pony with respect to its economy–IT and Aerospace (Add health care and it could be two and a half). If you’re an experienced IT professional or Engineer, you’ll find work easily, but in other areas, you will struggle.

      From what I know of Portland, you may well be able to find work if you are flexible, but you won’t find as many of the high paying professional class jobs that you will find in Seattle. However, the silver lining is that the lower cost of living in Portland compared to Seattle is lower thereby making those flexible lower wage jobs easier to bear.

  4. K Ackermann

    Albert, above, is correct about Portland metro, but many areas in the state are hurting.

    Moving here from Mass, it was stunning to see the amount of poverty amid such beauty.

    1. wunsacon

      I periodically “window-shop” in redfin. Parts of Oregon and Seattle look pretty inexpensive. But, I remind myself that places like Detroit became even more inexpensive.

      I suspect one day we’ll be saying “we’re all Detroit now!”

  5. TunoInCA

    I live in Silicon Valley. Supposedly things aren’t so bad here, however when I drive down El Camino Real I see loads of empty store fronts in Palo Alto, Menlo Park and Mountain View. there are also loads of empty store fronts on Santa Cruz avenue, which has been a popular shopping area since we moved here 15 years ago.

    I think that the unemployment rate here would be higher, if it weren’t for the fact that housing is so expensive, so when people lose their jobs they move out of the area quickly, back to other parts of the country where they have relatives. it seemed to work that way during the tech bust.

    Olive Garden, however, is mobbed. Since I’ve never eaten there, I don’t know why. Perhaps because other places have closed? or maybe it’s a trade-down for some folks?

    Servings at the Thai place we get stuff from have become tiny. Fortunately the chef owns the building, so I guess he can keep going.

    The demographics of the local Walmart (in Mountain View) have totally changed in the past three years. I buy a few things there (nicotine gum is a real rip-off elsewhere). It used to be staffed and shopped in almost entirely by Hispanic and Asian people. Now there are a lot more white employees and a LOT of white shoppers, esp. since they expanded their food section. Their packaged food is often a lot cheaper than at Safeway, for the same brands.

    I’ve been volunteering for the local library book sales for about 9 years. there is always conflict re what to do with the books that don’t sell. recently the book scavenger who picked up our leftovers quit doing so, so the “eww old books, toss em” contingent (yes, they exist even in this context) wanted to toss our leftovers. I insisted on offering them for free on Craiglist; 15,000 leftover books. hundreds of people showed up and took them all, every single book, even ones that *I* thought were cruddy. it was festive and kind of depressing at the same time.

    I did the same thing about 6 years ago and only about one third of the books went away.

    Some of the people who show up just want something free to read, but most are hoping to sell them to make a little money. I hope they manage to.

    I don’t see house prices going down much around here, but houses aren’t actually *selling* except in the towns that have desirable schools. I keep looking at the same zillion Redwood City and Boulder Creek listings; they never go away, and they never go down as much as you’d expect. who is going to *buy* all of these places????

    in eastern CT (my home area), houses are sitting unsold forever. the prices are dropped, but they still don’t sell. in Westerly, RI (where my parents shop), places don’t sell and no-one drops the prices at all!!! my parents’ friends attribute this to the sheer stubborness of elderly Italians.

    1. Anonymous Comment

      Hmmm… interesting. You say the Olive Garden is mobbed. I reckon it’s because they serve the ‘bottomless pasta bowl’ and free bread sticks. Perhaps instead of ‘three squares’ people are hitting up Olive Garden for the one big round.

    2. Martin

      I stay around San Jose and the commercial vacancy rate is over 50%. They are tearing down commercial parks and putting in what appears to be residential rental units. Also, the number of chronically unemployed really talented professionals is an incredible waste of human capital.

      1. Joe Blunt

        I hate that term, human capital. Human resource was derisively bad enough, when it was invented in the 80s. People in this country can have a horrible time without work, just horrible. They can lose everything. I think this is a waste of humanity.

        1. NaluGirl

          Those phrases are on a par with “consumer”. We need to start thinking of ourselves as citizens, customers, neighbors. We are not just voracious vacuums sucking up cheap plastic junk.

          1. Jeff

            “HUMAN COMMODITIES” is more appropriate.

            Agree about “Consumer”…when I hear that, I envision a guy with a funnel stuck in his mouth and stuff being poured in….

  6. Black Smith

    I’m a bit surprised that you are a bit surprised anyone can be surprised by the lousy jobs numbers for August. ;)

    Things in West TN proceed at their usual languid pace. Like others have pointed out; quite a few empty storefronts. In fact was trying to rent a storefront in a half-empty strip mall. The landlord wouldn’t budge from his premium 2007 rent price. I pointed out to him how his property was worth 45% less now and he needed to start working on some reality-based leases. The crickets chirped while he pretended not to hear me so I told him to fuck himself and walked out.

    I’m not the best negotiator as you can see but this ethically empty “human” had already wasted three weeks of my time. How is it idiots like that can stay afloat while others are loosing their houses?

    In other news, we took in an 18 year old homeless girl. We’re sharing her with a few other families to distribute the burden. Also; all the kids have moved back home, pets included.

    One serious accident or medical bill and we will all be out on the street.

    1. Psychoanalystus

      During the 90s I lived in the Cordova and Germantown parts of Memphis, TN, and found the quality of life to be very nice. I also owned a home in Cordova, which I sold in 1999 for a small profit, after having owned it for only 2 years. About 3 years ago I happened to drive through Memphis, so I drove by my former home again. The house was for sale again, this time $10,000 less than what I sold it for 10 years before.

      1. Black Smith

        Well, gosh! I live very near your old house, then.

        My mortgage is not underwater here, but it’s pretty darn close. We made the mistake of buying in the city limits. 100 yards more East and my house would be worth 15% more. Oh well!

        1. cos

          Black Smith, maybe im missing something here, but are you suggesting property values are higher outside the city limits? I’d think this would be counter-intuitive I’ve normally seen (not specific to Tenn) that homes outside cities are cheaper than within cities.

          1. Black Smith

            There’s low level class war going on in Memphis town – and, actually, has been for a while now. The city can’t incorporate the few remaining micro-cities in Shelby County. So people who have the money are moving out of the city limits because there are lower (or non-existent) property taxes, good schools, and less icky brown people (LIBP). Judging by the people I meet (my wife teaches aerobics to the upper crust around here), LIBP is a BIG selling point.

            A friend of the family who moved out here (but across the city line) has already bought and sold two(!) houses while a few streets away houses next to me have had for sale signs up for two and a half years at least.

            Ah, yes, there was a block party on our street this summer. My wife and I were stunned at the number of people who were actually renters. I’m pretty darn sure no houses were being rented here four years ago.

            Two years ago I said, “Honey, we just gotta hang on for another 3 years.”
            One year ago: 5 years.
            Today: 7 years.

            Presuming I live long enough to see my house sold, we’re going to pick up all our things and move to France. I’d like to see some old world culture before I die, that’s all.

      2. Kelly Arnold

        I actually live father east from Memphis, in Fayette County. In 2005 I wrote a huge check as a downpayment on a new home. It’s all gone plus some. The foreclosed homes in my very upscale neighborhood are selling for about 60% of what they sold for new. I travel quite a bit and I see the same things as everyone else. Empty, small store fronts, less traffic congestion, etc.

    2. John

      I’ve been told by real estate people that landlords get a tax write off by keeping their property empty if they can’t write it for the last rental price.

      So instead of lowering the rent they just take the write off.

  7. Psychoanalystus

    Until last week, I have spent the past year living in Malibu, CA and Houston, TX, while working in the surrounding areas (where “surrounding can be as far as 150 miles one way). As far as I can see, Malibu is still quite awash in money, with shameless spending apparently continuing unabated. In Houston we lived in an affluent area as well, primarily inhabited by Big Oil crooks and investment bankers, where the density of Porches, Mercedeses, fancy shops and restaurants rivals that on Park Ave in NYC.

    What I can say is that while these two very small affluent communities where we lived continue to do very well, and the counties and states they belong to continue to maintain their infrastructure to the highest quality, not the same can be said about the greater metropolitan areas they are part of. To begin with, Los Angeles is a total disaster. Poverty and homelessness are dismal, and there are no jobs to speak of. Some of the areas north of LA where I commuted to are actually almost third world, with poverty, addition, and crime completely out of control. So, outside of the affluent areas, California seems to be falling apart. Pretty sad for a state that not too long ago boasted things like Silicon Valley and Hollywood. And, I should add that this is not the California I remember 15 or 20 years ago. The economic collapse is very obvious in that state.

    As far as Houston, TX, is concerned, it too is a total disaster outside of the area we lived in. Traffic in Houston was not nearly as bad as what I was told it would be, although the freeways are a complete disaster in terms of maintenance. Houston’s freeways were the worst I have seen anywhere in the US. In general, the infrastructure in Houston is falling apart. Not only are the potholes the size of canyons, but there are mountains of trash and roadkill on the side of the roads that never get picked up. There is a “Space for Lease” sign in front of almost every building, many strip malls are almost entirely empty, and there are panhandlers at every intersection. Most malls I visited are like ghost towns (except for those in the oligarchic areas), and the infrastructure in the poor areas of Houston, such as Pasadena, resembles those in Afghanistan. As if this were not enough, thanks to a massive aging petrochemical industry littering the Houston area, the air and water pollution there are by far the worst I have seen anywhere. The only plus for Houston is that housing is very cheap, so we could actually afford to live among the oligarchs for a change. So there is your “Texas Miracle” for you. Thank you, Rick Perry. And thank you, Arnold Schwarzenegger!

    On a personal note, I have recently completed my employment contract, and I chose not to renew it, opting instead to take a year or so to rest in Europe and also travel to China, the Far East, and Australia. So there, there is at least one new job available in the US economy – my former job. Actually, in this field (mental health) there is an acute shortage of personnel, and the company I worked for (as well as their competitors) has serious trouble filling most positions. However, I should also point out that these jobs are heavily dependent on federal dollars. With the planned cuts in Medicare, Medicaid, and VA benefits, I would imagine that most of these jobs will soon vanish.

    I will probably return to the US in a year or more, and while I may consider California again mainly because of the beauty of that state, I am more inclined to try New England next. However, I do not plan to “mess with Texas” ever again.

    1. Heron

      Regarding the pollution in Houston, you can lay that almost entirely at the feet of Bush and Perry. Before Bush became governor and presided over the slashing of environmental regulations out of our state codes, Houston was actually ranked as one of the cleanest metro areas in the US. By the time he left -that is when he was running for President in 2000- Houston was actually under an EPA lien preventing any new construction because of how bad it’d gotten. One of the biggest failures of the Gore campaign, in my view, was not mentioning Bush’s abysmal record on pollution and waste in Texas during his governorship.

  8. Crocodile Chuck

    Just back from the US midwest: KC and St. Louis. Only thing booming is health care. Resi r/e construction dead, big co’s laying off, (anecdotally, since I don’t live there) no new business formation. All growth seems to be coming from the aging of the population (and this at the margin)

    1. Psychoanalystus

      Indeed, and once Medicare/Medicaid are scaled back, those jobs will vanish as well. As mentioned above, until last week I worked with the elderly in health care, so I know.

  9. hello

    tech anecdote—literally everyone I know/acquainted with who is school-age bought/wants an iPad in lieu of a new laptop.

    anecdote 2—my brother is a police officer and the volume of the traffic court docket at his local county cook is way, way down (probably due to less driving and people not looking to get a $100+ ticket???).

    meanwhile his graveyard shift is seeing a lot less drunk driving and domestic dispute calls as well (no money for booze = better behavior???) .

    probably due to less driving

    1. Black Smith

      I managed to snag two HP TouchPads for $149@. I don’t care if they are unsupported, they make kick-ass ebook readers. Plus I’ll eventually be able to root them and install Android.

      I’ve literally been waiting my whole like for a decent tablet, but I couldn’t support Apple’s Walled Garden approach.

      I can’t testify about crime at this time, but I’ve noticed the Emergency Rooms are packed to the gills. It’s much, much worse than it was ten years ago.

      1. NaluGirl

        People who have lost their medical coverage (and good-paying jobs) have no place else to go when they are sick or injured.

  10. John in Boulder

    Boulder, CO feels like living in a bubble! There is the government labs and college but also an entrepreneurial spirit unlike elsewhere. Clearly there is a lot of money, though this isn’t a land of Porches. More like Lexus SUVs. When the CU student population entered town in August you could feel the optimism of 30K kids who didn’t have to look for work and have been sheltered from the realities of life.

    I’ve spent much of the summer in Crested Butte, CO, a resort town whose clients come mostly from TX and OK oil country. Seems the OK global warming plan is to vote for Inhoffe and spend the summer in CO. The rich ones have come to CO in large numbers this summer to escape the miserable heat, spending even on CB real estate, which has been down for several years. I’d say they own most of the town. They even financed “Oklahoma!” as the summer play by the local theater. Locally it is typical resort town economy with plenty of low paying jobs and working class having to work several to make ends meet.

    1. G Marks

      Yes, Colorado is always booming, but there is lots of turnover in businesses. Ditto for Santa Fe.

      Tax law keeps dilettante wives in their ‘galleries’ losing money. The economies of these places is distorted because so many designer shops lose money, but have a presence in the towns and thereby a tax deduction for a business residence.

      It’s gotten so bad in Aspen that there are few places for breakfast because there are limits on what you can charge for coffee, bagels and quiche. The designer brands fill up the commercial space with shops that may or may not turn a profit… my sources say no.

      But it affects the entire city because those who actually need to make a profit – cannot.

      Santa Fe is crawling with dilettante wives losing money – but their second home is a write off – and they are FAR FAR away from their Long Island husbands [who like it that way]

      I could write a book on the distorted economies of Rocky Mountain wonderland – including sick sick Telluride.

      You cannot make a living in any of these places because TAX law has distorted the local economies to where you must be a millionaire to even toy with the landscape.

      1. G Marks

        — disclaimer

        If you are an old timer – own your home or commercial space in Telluride, Aspen, Crested Butte et al — you are set.

        The only prosperous newcomers are tourists. If you move to Colorado – especially the ski towns – you will be poor and unable to compete with the illegals for jobs.

        If you moved here back in the 70’s or had family here who owned property – you will prosper.

        But again, tax law is the killer. People LOSE MONEY paying inflated rents and leases… so their second home is a write off. To the average person this is nuts… but if you see it first hand you’ll see. PRADA doesn’t make money in Aspen… they pay HUGE RENTS which effect all the other rents.. but the vacation home they build for employees is a write off. You cannot compete when our own government plows up the playing field.

        I could go on and on about Telluride and Santa Fe… the economies are dictated by tax laws and inflated land prices – AND last but not least crooked lobbying schemes for upzoning conducted by former drug dealers who now man the courts and city hall — OMG! I know where the bodies are buried.]

        1. Martin

          Years ago, late ’70s, a fellow I worked with moved to Crested Butte to open a shop. He explained the cycle and how it was impossible to be financially successful. People would open a shop, run through all their money, run through whatever money they could borrow, go bust, and the next person would come in and start the process all over again.

        2. Colorado Psychic

          Rich people have more money to pay their tax lawyers and so on. You sound so jealous, so you scream taxes like the wealthy. They pay little and it is an inconvenience. Envying the wealthy’s ability to avoid taxation is nothing to shout “tax law!” about.

          1. G Marks

            Aspen is chock full of designer stores like Prada, Fendi and Migoscha. These operations distort the commercial real estate market because they pay ever spiraling prices for ‘exposure’, even as they lose money.

            All these multi national designer brands also keep huge houses as playgrounds for their management and the congressional committee members they purchase.

            It’s a downward spiral, making it impossible for anyone to run a profitable business. Ordinary economic formulas for commerce don’t apply.

            When The Cashmere Store finally closed after 20 some years, the owner lamented that she just couldn’t make the figures work anymore. Aspen is a 6 to 7 month economy, and everybody suffers when the economy is so distorted by operations run as a tax loss that there are no more breakfast restaurants or coffee shops… but for the ones run at a loss.

            that’s not capitalism… it’s cronyism and corrupt tax law at it’s most noxious.

  11. Middle Seaman

    Here in lower Montgomery County in Maryland that borders on DC, the external behavior is one of affluence, a lot of buying, expensive cars, etc. A closer look reveals quite a few closed storefronts, business that have been around for decade shuttered and panhandlers show up in many intersections.

    The whole DC area lives of the government; all other business are dwarfed by the beltway bandits, government workers and a large legal system, lobbyists, representatives of states, other countries, businesses, etc.

    Still, a closer look reveals more long term unemployed especially among middle age and above workers.

    A more national trend is the weakening of academic institutions. While the presidents and the senior VPs enjoy hefty salaries, faculty has had its salaries frozen from 2008 without signs of unfreezing. Although not all academic institutions are badly affected, the affected percentage is high. The result of the freeze is low moral and loses among among the more prominent academics.

    Together with the savage attacks on teachers from sea to shining sea, our once exceptional education system is in a real depression.

    1. Sufferin' Succotash

      As a resident of Bethesda MD I can second your remarks on the local economy: all the marks of government-generated affluence with the added Dickensian touch of panhandlers at intersections. Maybe the middle-aged guy with the sign saying “Vietnam vet out of a job need help God bless” standing outside the local Lord & Taylor is making it all up. But they all can’t be making it up.
      Some very close friends of ours have been heavily involved in the local real estate business for years and they say business is pretty much OK, home prices holding steady, etc.. Welcome to DC. Meanwhile, local governments scramble to make ends meet. Welcome to the US of A.

      1. neo-realist

        “Some very close friends of ours have been heavily involved in the local real estate business for years and they say business is pretty much OK, home prices holding steady”

        Hey, Lobbyists need homes too. Gotta live near the prey:).

        1. Black Smith

          Yeah, what happened there? He pegged my loyalty to the max in 2008 with his mind control. Then one day I woke up and noticed the rectal bruising.

        2. Sufferin' Succotash

          I’ve got Perry pegged as the Mule. He’s not part of Seldon’s Plan. He’s supposed to be the false-flag candidate intended to make Romney look like a centrist. Instead, he might very well grab the nom for himself. Obama resembles the clueless and ineffectual Foundation Mayor Indbur who doesn’t stand a chance against the irrational forces embodied by the Mule.

      1. Abelenkpe

        Lol! I’ve often thought the same. Grew up in DC and got as far away as possible as soon as I could.
        I think of my current location as a modern day pompeii. A coastal city destined to end in natural disaster. Maybe one day people will read a journal describing fleeing survivors tying pillows on their head to avoid falling debris? Or excavate homes filled with families dying in embrace and wonder why we lived so close to these fault lines?
        For the record: it is the climate and beach.

  12. CaitlinO

    In July we took our first driving vacation in years. Eager to escape the unbearable heat, we traveled from the Dallas/Fort Worth metroplex east to the Smoky Mountains of North Carolina. I was astounded at how much better everybody’s roads are than they are here in Texas!! We drove on interstates, city streets, country roads and the Tail of the Dragon and every last one of them put our most vital, most important interstates to shame.

    My car has been broken twice on I75 when I hit potholes big enough to swallow Cincinnati – at a cost of $1800 in repairs. I guess that’s Perry’s Texas miracle – shift the burden of the cost of road repair from the state to motorists. Meanwhile, every time a new highway is built or an old highway is expanded, it presents a good excuse for a conversion to a toll road. It recently cost us $13.80 to use Highway 121 for 43 minutes. There are millions of Americans who don’t earn that much per hour!

    Cost shifting also occurs at the schools. We have a teenager who is still in high school and is involved in two extracurricular activities. Fees and supplies for this one child at a public school are just over $1600.

    Perry’s just another corrupt corporate butt-sniffer. He should stay here, hold himself accountable and fix the problems he’s created, not try to export them to the country at large.

    1. Out of the Frying Pan

      These stories of Texas from residents are giving me an idea to keep Scary Perry at bay. A few well crafted you tubes or campaign videos graphically highlighting the sturm and detritus of his rule there could make the point – sounds like there are endless examples to highlight.

      Meanwhile, things have been relatively fine in the cool and temperate beauty of the SF Bay Area this summer. One hundred days of heat over 100 degrees in that free market paradise being sold to us as Texas don’t particularly appeal to me, particularly when you have to breathe it in as a benzene aerosol cocktail.

      I can’t say I understand the obsession with social media, cloud computing, and online gaming that for now is partly keeping the northern California high tech hub booming. But it beats belching smokestacks and the proliferation of useless “stuff” at any rate. No doubt this one will pop too eventually, but it seems like they always have something else up their sleeves. Commercial real estate is roaring back for now in the heart of SF.

      Ah, but I can chuckle privately as I read blog comments from around the internet where residents of the broad middle kingdom of the good ol’ US of A regularly spit their ire towards kommunist California, and am content that the likes of Cheney, Santorum, and Perry stay as far away from us physically as philosophically.

      1. San Pornando

        What weed are you smoking? Unemployment in Cali has been some of the highest in the nation. There is plenty of innovation in tech from California, yes, but much their product is largely subsidized by the MIC, in this way the happy workers are no different then they are in Northern VA. CACI is just one of hundreds of corps Dick Bin Cheney would approve of, so the buildings and logos look the same in both places too.

        1. Out of the Frying Pan

          What am I smoking? Nothing. Haven’t for a long time. Who the hell are you?

          I’ve lived in most parts of this country over the years. The Bay Area is by far the best and only place I’d choose to be. Seems to be doing ok lately too.

          If you’re talking about the central valley or exurban LA, or the ‘state’ of Jefferson, you can have it. That’s not my home.

          1. Henk Networks

            Again, California has had some of the worst levels of unemployment in the country and it is still bad. In addition to gutting California’s legendary educational advantages, there doesn’t appear to enough money to cram enough people into their prisons. You should try smoking, wealthier areas tend to have access to the best drugs, maybe this would help you look past the 7 dollar lattes.

    2. rps

      ‘Cost shifting’
      Hammer meet nail…..Bam.
      We’ve been experiencing cost shifting since Jimmy Carter’s allegiance with the Chrysler management bailout and UAW submission/roll over since 1979. Since then we’ve been living the Capitalist propaganda of shifting the “burden” back onto the laborers. Profit sharing of labor’s wealth production is closed to the proletariat.

    3. rps

      What’s that saying you get what you pay for? Texas State income tax rate is 0%. Ain’t it great!, Isn’t that the charm of Texas?/snark
      The elitist don’t send their kids to public schools.

    4. Jeff

      Agree re Bay Area, Marin County just across the Golden Gate from San Francisco is doing fine.

      Except for the housing-project dominated and destroyed Sausalito Public School District and parts of Hispanic dominated San Rafael,the public schools are a magnet for parents fleeing San Francisco’s Kafkaesque “federal consent decree”demographic nightmare of busing and social engineering.

      In addition Marin is clean, safe and a quicker commute to the office jobs in the City than from say the southern
      edge of the city. Lots of women oriented businesses such as fancy eyeglass frames, custom jeans, Nordstroms, nail, hari and botox parlors. Saw a White gardener working out of the back of an early 2000s Land Rover SUV. The Hispanics are going back home in large numbers judging by the numbers the used to stand along the road in San Rafael.
      All in all, a great place to live and easily defensible from the hordes crossing the two bridges from the nearby cities to the east and south should the SHTF.

  13. MarcoPolo

    Don’t know about Maine. I have spent the past 5 months in Spain. Madrid and Barcelona appear ok at first, but after a few days you see the stress. The rest of the place is desperate.

  14. Hugh

    The jobs report was worse if you consider that we needed more than a 100,000 jobs in August just to keep up with population growth. So zero jobs created actually increases the jobs deficit by 100,000+ jobs.

    A largely unreported but highly significant number in the report is that unemployment among African-Americans jumped nearly a full percent in August to 16.7%. White unemployment actually edged down slightly to 8%. So the unemployment rate is now more than twice as high for African-Americans than whites. And this is the U-3 number. The overall U-3 was 9.1% and the disemployment rate I calculated for August was 18.3%, or twice the official rate. Apply that relation or anything like that relation to African-Americans and you are looking at a disemployment rate in the mid-30s. That’s catastrophic, and even more cruelly ironic with our first African-American President. Of course, the cruel ironies do not stop there seeing how this awful jobs report came out on the Labor Day weekend.

    BTW we define disemployment as the U-6 measure of un- and under employment plus the BLS undercount. Under employment is essentially part timers who can’t find but want full time employment. The BLS drops millions from the labor force and hence its counts who would participate if economic conditions were better. This is its undercount.

    The other thing that this jobs report brings up is the R word Recession. Of course, in many parts of the country, recession/depression never left.

    1. Sam Adams

      I live along the coast of South Carolina. The Million dollar beach houses are not selling. Middle range beach houses are not selling and the lower cost housing is being foreclosed. Its not uniform. At the same time local papers are talking up the real estate market, the evil of unions, the waste in public schools and the benefits of greater tax cuts for the wealthiest residents. So all in all we’re waiting for the local citizens to fire on Fort Sumpter with Rick Perry and Michelle Bachmann leading the charge.

    2. Jeff

      Back to the Hispanics standing by the side of the road count as indicator of the Big Looming D…

      I have never ever seen a Black day laborer standing by the side of the road looking for work in spite of all the unemployment. A few Whites, but never a Black or an Sian.

  15. David

    Visited the southern New Jersey coast a few weeks ago and noticed so many of the holiday homes were up for sale. In Cape May I saw seven houses in a row have a “for sale” sign on the front lawn. In Atlantic city, plenty of people walking the broad walk, but not many were buying from the small shops.

  16. hapa

    about a year ago i started taking a peek at this BLS map — — showing headline unemployment by county over about the last year.

    the map doesn’t show population density. this is very deceptive in states like texas with wide empty spaces inhabited by specific employees. (the cities to the east show their trouble.)

    kids, can you find the beltway on the map?

    during the time i’ve watched, the staff adjusted the color scale so you could see the difference between 10% and 15%. previously huge parts of the country were just ‘off the charts.’ a heartbreaking accommodation.

    1. CB

      In those areas of lowest unemployment, what kind of jobs/wages are we talking about? I’m curious because some of the light yellow areas appear to be in parts of the country that don’t support high wage employment.

    2. Pragmatic Realist

      About a month ago there was some publicity about a study showing a decline in women’s lifespan in counties across the country. I was shocked to see a solid block of red in the area where I live in the Tri-state area of South-west Ohio, Eastern Kentucky and West Virginia, indicating a decline of 1 year in women’s lifespan between 1997-2007. This is the map:

      Looking at you unemployment map, I see the same counties lit up in blue with 10-12% unemployment

  17. P. Zoellner

    You asked for observations as to how the economy is doing. Here’s one
    aspect which I am suspicious of and wish could be quantified. Is it possible
    that companies are hiring lots of part time workers instead of some full timers?

    The trick would be to get two part timers instead of one full time worker. Then they don’t have to pay benefits. No health care, no holiday pay, no pension, etc., no perks at all. The job still gets done. Savings go right to the bottom line.

    On another subject. Nice going. Keep up the good work.

    1. Black Smith

      Quite a few ad agencies here in the mid-southern states simply contract independents for art and coding and drop them when the project is over.

      I’m in a floating pool of programmers that are contractors, but in reality it’s more like very limited serial employment.

      No benefits. No hope.

    2. neo-realist

      As Black may be alluding to, I suspect there is a lot of temp hiring by companies, particularly during the summer months to cover vacationing permanents, who get shown the door when the summer or the busy periods wind down.

      1. John

        I’m temping at a company that has laid off half of their employees this year and told the ones left that their new business modal is to hire temps as they need them, and lay them off when each job is done. And that can be as little as one week’s work.

  18. tomk

    I’m farther along the Maine coast near Bar Harbor. I hate to disagree with you but I think your Maine observations may have been skewed by Irene. We’ve had what seems like a fairly normal summer of traffic and visitors here. On the other hand the Goodwill store in Ellsworth is always packed and the food pantry is struggling to keep up with demand

    1. Yves Smith Post author

      I got an e-mail from someone who vacations regularly in Maine, was up two weeks earlier, in Damariscotta and Southwest Harbor and remarked:

      I was struck by how little traffic there was on 1A from Southwest to Bangor to pick up 95 and indeed on public roads everywhere. Big shopping center outside Brunswick (stopped to watch tennis at a sports bar) not really busy as these things go. Zero traffic all the way home until within sight of Bronx Whitestone

      This was early enough not to be the result of Irene.

  19. David Lentini

    My wife and I have lived near Ogunquit for several years now, and we’ve noticed the same thing as you–the traffic just isn’t at the same volume as in the good years when we came here to vacation. Route 1, which is usually one long snarl of cars going to and from the various hotels, restaurants, an amusements, is more crowded than in the off-season, but nothing like what it used to be.

  20. Anon

    No holiday this summer for various reasons, but in March, I was on the coast in Kent, south-east England.

    Huge variation from town to town. The troubling, run-down ones such as Folkestone (ferry port now compromised by existence of Channel Tunnel?) appear to be dumping grounds for those on state benefits, effectively the new bantustans for long-term unemployed, mentally ill, addicts, many of whom have been shipped out of urban centers closer to London because rents are cheaper (and hence housing benefit costs lower) on the coast.

    Similar such towns include Ramsgate, Margate, Hastings, although regeneration cash has washed into some. (Margate just got a smart new art gallery.) Hastings, like Brighton before it, has become a domitory town – London house prices are forcing people to make 2.5hr daily commutes by rail. Vast, US-style retail parks on the peripheries provide some employment, but hollow out local retail.

    Hythe, an affluent area on the edge of Folkestone, maintains a flourishing high street with several charity shops (donated goods for resale by British Red Cross, Oxfam). Usually, these are run by doughty retired women, but in two (was with my mother, who loves to browse used books) was surprised to teenagers coming in asking to volunteer – were well-educated kids obviously desperate to get some form of work experience, even unpaid, on their CVs.

    Back in London since then, and the riots came as no surprise. ConDem coalition willfully, pridefully bludgeoning the have-nots with lunatic levels of austerity – youth clubs in deprived areas reportedly closed overnight at the start of summer with no warning, tiny weekly stipend (EMA) that kept kids in school after 16 cut off dead so swathes will not be returning to education this autumn, even though youth unemployment is already at 20% – and all this in one of the most expensive cities in the world.

    One rioter was sent to jail for six months for looting £3.50-worth of bottled water. Michael Gove MP, the ConDem education minister (and employee and confidant of Rupert Murdoch) last year had to repay £7,000 in parliamentary expenses he shouldn’t have claimed – but despite his looting of the public treasury, Gove wasn’t sanctioned in any other way.

    Applying the scale of punishment used against the rioters, where £3.50 = 6 months’ incarceration, to Gove, where £7 = 1 year, £7,000 = 1,000 years, Gove should serve 1,000 years in jail in my view. Just, as Voltaire said, to encourage the others.

    But it is this sense that the haves are simply laughing at the rest of us, while walking away scot-free, that drives the fury – not forgetting that the spark at the epicenter was a man shot dead by police.

    Our next summer, which includes an Olympics, should be one to watch:

  21. Philip Pilkington

    What is crassly called ‘globalisation’ has had a major effect on geographic landscapes all over the world, as far as I can see. When you go to wealthier areas — especially those where people involved in the FIRE ‘industry’ live — you don’t notice the downturn much (even in Ireland, where the unemployment rate is 14.4%!).

    That’s because the only people unemployed are young folk (>26ish) and they’re usually kicking around spending their parents money or whatever. The rest have moved somewhere else — at least in Ireland.

    But then go somewhere that’s not as well off — in Ireland that would be the Northside of the city or maybe some of the surrounding country and… WOW! The change is massive. A friend of mine lived in a certain area on the Northside of the city for three years. He always loved it. Then he moved back down to the Southside. He told me that he started getting worried he was going to get mugged on the way home from the bus-stop. All these guys in their twenties had just sort of started hanging around in tracksuits looking shifty. When you go to these areas — which were fine two years ago — you start getting a feel for the environment in which the London riots kicked off in.

    The affluent have insulated themselves well in the current crisis — both financially and geographically. It’s a bit creepy.

    1. Foppe

      The affluent have insulated themselves well in the current crisis — both financially and geographically. It’s a bit creepy.

      This is nothing new. ;)

      1. Black Smith

        If I was affluent I’d be doing it too.

        I watch the rich in the next neighborhood over and think about how delicious that fatty marbled meat would be. Meanwhile kids from the inner city are looking at me and thinking the same thing.

          1. Skippy

            Humans are a bad dietary choice, don’t you see what they eat!

            Skippy…anyway were just a bunch of passive herbivores…Honest[!!!]. Although after consulting my ancestors, see: Don’t make me gallop again…


            BTW for a taste, a lick would suffice, why must all think bite, rip, tear…rofl…humans…oh look a bear over there>>>>!

  22. Dayve

    Am living the tragi-irony of being fully employed, yet earning ‘power’ not keeping up with bills. A sense of slow, inevitable sinking. Borrowing from Peter to pay Paul, et al. Salary is 2/3 or less of pre-2009 level.
    How’s my holiday economy? One step away from being a homeless hobo. Not knowing where my next meal is coming from. Can’t afford to go anywhere.
    Raised in age of benevolence and ever-expanding optimism, now a present day version of the ‘working poor,’ I live my waking life shadowed by the parallel universe of what once was, and still is, for some…
    Grateful to be working, yet stunned daily by inundation of more bad news with no let up. Sleep is my last remaining refuge.

    1. Black Smith

      My wife has taught me to do some wonderful things with beans! I’m not joking. We’ve had to face some hard realities in our shopping habits and we’ve cut way back on meat. I scan the grocery store flyers regularly looking for chicken on sale.

      The hardest part is weaning the kids off fast-food. They perceive it as $5 here, $5 there, no big deal. We’ve shown them it adds up to a basket full of groceries which goes much further. They just roll their eyes. Same as it ever was.

  23. eric bowman

    I’m in central VT, where, due to circumstances beyond our control, we’re experiencing our 15 minutes of fame. Due to flooding the state road system took a big hit and here, as in other rural areas, roads and jobs go together. As this is home of “you can’t get there from here”, it just became a bit more so. For some, their jobs just moved futher away and as we are looking at winter over our shoulders,that’s a little anxiety producing.

    Vt’s not a very wealthy state even in the best of times but my sense is that (as a whole) we’re kinda close to pre-crash prosperity. Not exactly of course and I think there’s a good deal of holding of breath & we’ll see what the flooding does to us long term. Even tho we didn’t have the real estate boom/crash, that “industry” has been affected in ways you can clearly see. Huge number of houses for sale throughout the state…from the crossroads town to the cities. Empty storefronts/commercial buildings are slowly appearing. So, all in all, economically things are just ok,not crushing but could be better.

  24. Ep3

    Yves, I think I have mentioned the hell that is Lansing michigan. Tho things aren’t as bad as 2008-2009. But things are bad for other reasons.
    See the governor elimintated the michigan business tax and began taxing seniors pensions, based upon age. There is a 6% large corporation business tax, but it’s gonna drive away large companies and hurt businesses as they grow to that threshold. Now he wants to eliminate the personal property tax and not replace it.
    But one thing that has hurt a lot of businesses in the area was a bill passed under the previous governor to eliminate smoking in bars. This took effect in may 2010. Now some of your larger bars that are more restaurants have been hit but aren’t about to close their doors. But the local small town hole in the wall bars have really been hit. And this really hurts any chance for a “small business” recovery.
    July was really bad all over. Obviously seniors are the ones with money and when Obama was telling them SS checks wouldn’t go out, they stopped spending.

    1. sleeper

      Great post –

      I travel some for business – mostly eastern US

      And here’s what I see –

      About 20 % (or more) of business parks are vacant as are industrial parks. This seem to be pretty much universal. including Chicago, Newport Beach, Houston, Philly, the Midwest ( even new industrial parks are vacant), Nashville, Memphis ( a real disaster hotels – in the heart of downtown have armed security guards), the southeast is full of vacant prefab sheet metal buildings and I won’t even mention Detroit other than to say the difference between Detroit and nearby Grosse Point is nothing short of amazing.

      A local industrial supplier says that industrial business is slow but steady but the motorcycle parts business is going well. Most of the smaller furniture / textile towns are in dire straits mostly pawn shops, tatoo parlors, second hand stores, gun shops, and empty buildings where copper theft is a major problem.

      In some areas local populations of (mostly male) of day laborers have created sort of Hoovervilles which the local police leave alone. In some cases local municipal power is tapped into. I have even seen folks bathing in a stream within a 1/2 mile of a downtown capital center.

      An in some towns drug use particularly meth, opiate, and prescription drugs is amazingly common. This is particularly true of smaller towns with easy access to the interstates.

      1. Jeff

        Yeah, he’s just an addict lamenting his loss of
        “freedom”…far more people around here go into
        bars because now they don’t have to put up with
        some slob nicotine junky’s stench.

    2. john

      Having to walk outside to smoke has not hurt bars in Chicago, LA, NYC or any other town/city I’ve ever visited. Why does it matter in Michigan — to the point of hurting ‘any chance for a “small business” recovery’?

  25. Prosecute Cheney Before Its Too Late

    It’s a lie, but Yves Inc keeps on repeating it:

    “yes, Virginia, while the authorities did keep the financial system from imploding,”

    Another lie from Marketwatch yesterday had Weidner reminding us the “banks have paid it all back” . Don’t sue me bro.

    The New York Times won’t report on soldiers who put bullets in women and childrens heads. I wonder if that helps holiday shopping.

    1. Yves Smith Post author

      You have this dead wrong. The authorities did keep the financial system from collapsing. My remark is accurate.

      Making a true statement does not say they did it well, or more important, took steps to reduce the odds of happening again. i’ve inveighed on that topic repeatedly.

      1. Lil' Eichmann

        No way – you’re wrong. If the Financial Sector imploded we (the lil’ fish) would have been far better off. Folks have been stripped mined and left to rot by “investors” and you’re just repeating the slogans of the precious financial sector.

  26. ElSnarko

    Yves, regarding your original question I was in Va. the other week and it looks normal and Washington was, indeed, itself. Here at my home in Dayton, Ohio I an tell you that I see four trends. The housing blowout that began here ten years ago is in the death throes with out of area investors bottom feeding for deals.OF those residents that are in the sub 60k valued house areas (most of the city) marginal upkeep is now visibly slipping even for conscientious and smart retirees and those who have lost the manufacturing jobs that were our raison d’etre. More rentals, with worse and worse renters.

    Hi end and even nice restaurants are having a progressively harder and harder time remaining opened. Cookouts are smaller this year. Steaks to burgers, burgers to brats and hot dogs. Food vendor business at our terrific free (mostly) outddoor music events is down.Alcohol consumption is up statewide. Dayton has apparantly bottomed and may bounce, Toledo is a disaster, as are vast tracts of Columbus and Cleveland, Akron, Youngstown well….

    I hate to put it this way but the former homes of the people who worked in the factories and their neighborhoods are now indisdtinnguishable by race.If you are not management of a quite successful business you are in deep trouble.

    On employment. This is too strange to almost ponder. Actually this was apparant about six years ago but is not worse. You need about 25 years experience to be even considered for and IT job. For most management positions it is ten. For sales….SALES it is five…AND be currently employed.
    Locally employers are raving about not being able to find factory floor workers who want to stand on their feet and work for eight hours. This is an exact quote for the paper last week. Thing is with GM collapsing wages for new hires and the machine shops always paying less than that there is no money in it. Even more damning there is NO CAREER PATH. None.Best Buy is cutting back so the optins are cheap furniture retail, burger flipping, cell phone stores, crap retail. The only good source of relaible jobs is police, fire, and city, towewnship, county work, ..they have good benefits and actually are getting at least some raises. Well this is 75% of the state. The other 25% does not actually see this at all. They are worried about a drain on their 401’s.

  27. Capo Regime

    Things in the greater D.C. Metro area have slowed down a great deal. Its not so much that the journos/propgandists live in a geographic bubble but a social and ideological bubble. Bear in mind D.C. leads in child poverty, the schools in suburban maryland have laid off 3,000 teachers, the large contractors are laying people off, black unemployment is going higher, more crime. Admittedly, D.C is fairing better than the rest of the nation but cracks are showing and their is fear in the business community. I work, live and do business in D.C. have laid people off and my earnings are lower and I expect things to get worse. Even the lobbying and white shoe law firms are hiring a lot fewer people

    1. BDBlue

      DC is definitely losing its bubble. Housing prices are beginning to fall in areas that had done a pretty good job of weathering the downturn. Essentially, the housing market that had collapsed was the far-out suburbs. Also, houses that had climbed to more than 2 federal paychecks could afford tended to drift back down to the range where 2 federally employed professionals could afford to buy them. Now, the floor under the close-in and more reasonably priced (still not cheap) housing is beginning to falter. Federal employees are facing a pay freeze, most expect to get hit for higher pension/healthcare contributions, and there is essentially a hiring freeze in a large part of government. Government contractors are also looking at a hit. Lawyers and lobbyists still do well at the top, but they’ve adopted their clients’ attitude about screwing over the employees to keep their pay rising so there’s a lot of uncertainty even among the well paid young professionals.

      Downtown in recent weeks I’ve noticed a lot more homeless people begging. That could be a result of the heat index no longer being 110, but it does feel at least as if things are getting worse.

      If you go to a place like Old Town Alexandria, there are buildings on the main tourist/retail drag (King Street) that have been empty for a couple of years, although you will see a business open up now and again. Same thing for other tourist areas in the District.

      Basically, DC has been one area where the federal government provided quite a bit of support to the collapsing economy. Instead of trying to expand that and help everyone else out of the mess, the political elite seem determined to simply remove the support from the DC area so it collapses like everywhere else. I really hope all those Obama officials bought houses/condos when they moved here in 2008 and take a bath on them. It would serve them right.

      All of this is with the caveat that DC has always had a poor, mostly African American under class (the under class in VA and MD also exists, but is more ethnically diverse). They got hit very hard early on and continue to be hit hard.

      1. Capo Regime


        You are completely correct. Live in Old town and work/business in D.C. Things are trending downward. Some neighbors have speculated that some of the D.C. press are nastier to Obama because they (reporter) actually knows somebody who lost a job. While the presstitutes have been in a bubble is is deflating. Hard for them to continue to scream recovery when as you point out business in Old Town/Gerogetown close, and their neighbors get laid off, their kids can;t get a job at that K street law firm. Darn it, reality breaks through sooner or later….Sometimes economists and D.C. journalists remind my 94 year old father of Feld Marshall Jodl, telling Hitler–“We are really winning!!!!

        1. House O' Saud

          You can really make it in Bethesda by getting that sole source contract from the Government ATM. Sit in a cozy office, hire some bodies for the agency, send them off to some Federal Warehouse to do the 60 hour weeks. Government management loves contractor employees because they can treat them like shit and fire them for anything. I know for a fact a demoralized hell hole like NASA has contractors on the bubble, who are but a spreadsheet away from being tossed out on their asses. I have never witnessed such brutality an aggression towards workers then in some Federal Agencies. The rentiers have a lucrative system of communism. They are going to take all of it, destroy collective bargaining unless it is for the police force to protect their castles, throw the “welfare” concept
          right into the oven. Lockheed is here. Houses are typically bigger then the public library.

          1. Capo Regime

            House o Suad,

            You are correct. Even the sole source, 8(a) and all the other contracts are tightening up. Agencies are clamping down on the billable hours and going fixed price. Lots more contract employees (no benefits, short term job) are being used in contracting. The federal employees are a demoralized bunch with frozen wages and historically seeing how contractors make the big bucks. Yes, there are quite a few still sitting in a nice office in Bethesda or Old Town while minions go do pointless IT contracts in some dumpy government office while they skim $40.00 an hour from the 35 poor bastards (many H 1B) toil for 60 get paid for 40. Even the contracting hustle is winding down a bit.

  28. Susan the other

    We live in the mountains in northern Utah. The entire state is doing OK, not great, just OK. Our little town is hurting a bit, but the tourists are still coming. We have fewer international tourists now but we still get day trippers. But here’s the interesting thing we noticed: the jet contrails used to cross-hatch the deep blue sky above us. Now we rarely see a contrail. Maybe they are all taking different routes to NYC and LA these days.

  29. cwaltz

    I live close to a college so I watched back to school carefully. While there was steady traffic it seemed like people were spending less.

    I also noticed the little burg we live next to has unemployment trending in the wrong direction. In the last couple of months we’ve gone from 6.5 to 7.1%. The state/local seems to be hiring only minimum wage type positions. 25 new bus drivers being added and some teacher’s aides as part time help(probably way cheaper than adding teachers to expanding classrooms.)

    Oh and all the houses we’ve been looking at are foreclosures and short sells. All of them. Yeah. It lierally makes me sick to my stomach to know that a sheriff deputy is spending his savings desperate to avoid foreclosure on his house and his salary doesn’t support him owning a doublewide on .2 acres without his spouse adding to his income.

    Not a pretty anecdotal economic picture

  30. chogra

    Each of the past 3 years the extended family has rented a house in Nags Head for a week. We go after Labor Day — no children and the prices are much less than peak season). We try to get the first full week after Labor Day. Last year that week wasn’t availalbe, and the first week we could get was in early October.

    This year, not only was the week available, but the rates were not only much less than 2 years ago (same week), they were SIGNIFICANTLY LESS than the October week was last year. Normally there is a steep drop off in rates as you go through the year. This has nothing to do with the hurricane, as the rates were published and our week booked during the winter.

  31. From Oregon

    It’s pretty dismal for high tech folk in Oregon. Having just one healthy player (Intel, who doesn’t believe in hiring anyone over 40) creates a hostile environment.

    Tektronix, once a pillar of the industry here, now hires almost all of its engineers in India or China.

    The bulk of what’s left here is social media and phone apps.

  32. Glen

    I think we can rule out Timmy’s confidence fairy fixing the real economy (but it’s done a wonderful job with his boss.).

    The economy is a mouth full of rotten teeth, and all Timmy keeps doing is handing out more candy.

    And it’s past time for Obama to quit eating the candy and come down off the sugar jag.

  33. Chaos

    Great thread Yves. Thank you, these comments are very informative.

    Southern CT – My sense is that there is a sharp divide in the population here. The well off are doing very well and are spending freely. For others, money is tight at best. Escalating costs, flat wages, increases in local and state taxes has caused them to pinch pennies and dry up all discretionary spending. I can see the divide within my own family. Housing prices appear to be stabilizing, properties are selling but it is not robust. Business is getting by. My sisters business, which is more geared towards more affluent clientele, is expanding and has secured the needed financing.

    Labor day weekend is normally a big family together (everyone is local) with a big cook out. We are still getting together this year but at a significantly downsized cost.

  34. Duck Shoe Rage

    Labor day is a time for rest, to get right back up on Tuesday and with a bright smiling face continue the fight against terrorism. Support New York AG Eric Schneiderman. Impeach Tom Miller.
    We have a powerful enemy, DeMarco comes after the Banksters and an immediate shit storm of “you’re hurting the economy” comes from the Corporate Politburo. They have no idea what hurt means in a bad economy.

    1. Out of the Frying Pan

      Banksters and the CP said “you’re hurting the economy”?

      That’s funny. Were they looking in the mirror grooming themselves when they said that?

  35. luko

    I went to a family gathering in NE Ohio. Wow. If it wasnt for medicare/medicaid there would be nothing new in Akron for 30 years. As it is, some parts are seriously third-world looking. Then you go past an orthopedic practice built to resemble the Crystal Cathedral. Drug dealing in what were once very exclusive areas.

    Minnesota. So I live North on the road to our famous “Up North” and this year the traffic has been very light. I almost don’t know it’s Friday rush hour. Used to be a 2 hour drive on the holiday weekends. I was home before 5 yesterday. No boats. No construction traffic. Home sales are completely stagnant in my county. A 3K square foot home with an acre of land and a 3 car garage completely redone in 2005 sits empty month after month. They are asking $200K. Nobody will buy because you can get a similar foreclosure in this area for around $150K. Brutal.

    Some areas though are doing very well. Lines for $50 a head restaurants. New Mercedes clogging the limited parking spaces.

    My opinion – the middle class is done for. Once I either retire or get laid off I’m headed for one of the coasts. We figure it’s safer there. And closer to Canada if things go really sour.

  36. PQS

    From outside Seattle:

    I have to quibble a bit with the earlier characterization of Seattle as only tech and finance…we still have Boeing, which is still making airplanes and all the associated industry that goes with it. We also have other engineering work around here, and I’ve heard about green tech, but not much.

    Yes, Seattle proper is very segregated, but it’s always been that way. Race relations here are tense, IMO. I’ve heard things come out of peoples’ mouths that I never heard in 13 years in the Southwest…..Yes, we have a lot of homeless kids and adults, however, in the summer these populations typically soar, because the weather here is so pleasant. I’ll be interested to see what happens in the winter and how many “left behinds” are still around.

    Bloated government? You got it. BUt we also have about 150% more social services than places like Nevada, Texas, or other Republican outposts run by people who seem to think little old ladies from the local churches can take care of everyone all the time….One of the reasons I moved here was because I got tired of seeing so many homeless desperate people on the streets in Las Vegas – during the big boom times, no less. One-legged prostitues outside the grocery store aren’t what I want my kids to see growing up.

    In commercial construction it is all tenant improvements, lots of vacant space, and little new construction. Haven’t seen the big volume of facilities type work (grocery store redos, etc.) that are usual for most commercial enterprises every few years. Now they’re delaying the work or just doing it themselves. Work is frantic, though, because so many companies and workers are either gone or have moved to other industries, so what is left is being taken up by fewer bodies. And of course management won’t turn down even the silliest request if there is any hint of a prospect, so we spent untold hours chasing “opportunities” that get taken by someone else for 10% less in the end.

    I work on the eastside, which is a swanky suburb of Seattle. SF prices used to be MORE than Seattle. But I noticed the other day that the mall parking lot was practically empty, and it used to be packed to the gills with suburban trophy wives and their kids in $500 strollers. I think a lot of that has gotten toned way down, and even the Whole Paycheck grocery store is much more affordable than it used to be. (I went there to pick up lunch supplies and was pleasantly surprised – that place used to be astronomical.)

    It’s the New Normal, and nobody has the first idea what to do about it that doesn’t conflict with someone in power and their ideology…

  37. Abelenkpe

    Company I work for is opening new office and actively expanding office in LA. They are laying off many workers for a few months but plan to hire them all back in January plus add more. (Which is typical for the twenty years in my industry) My commute (which is only eight miles) is still total hell having never enjoyed the typical summer break in congestion that comes with school being out. So rush hour should be even less enjoyable next week. The grove and Beverly center are still insanely crowded on weekends and beaches covered with tourists. I hear the economy is bad, and I believe it just don’t have much evidence of such in my particular area at this moment in time.

  38. rosalind

    Los Angeles, CA: H’wood Blvd bustling with tourists, but not as many foreigners. Homeless on every street corner, with many begging window to window during stoplights. Fire Stations on rotating closures. Police having to make do with much less. County upping the furlough days for their workers. Property crime up. Graffiti up. Housing prices down. 12% unemployment.

    Loss of Borders leaving huge stores standing empty. Retail away from prime locations crashing. Imports at the Ports down. Traffic at Burbank Airport down.

    On the plus, stimulus money funded Highway 101 repaving from Santa Barbara to Salinas, and a massive sewer upgrade project paid out of our regular sewer fees has been going on the last couple years in my area.

  39. decora

    i know some people who got new jobs – with oil and gas companies. emphasis being on GAS. thanks fracking. (just dont drink the water)

    daytime tv ads: social security disability lawyers, injury lawyers, and dozens of for-profit colleges like ITT Tech. one person i know who graudated from ITT Tech is working at wal-mart. i know a few other people who are in college, getting degrees that some underemployed people i know already have.

  40. Psychoanalystus

    In my other job I teach online psychology and philosophy classes. I am always amazed about how many of my students state that they plan to emigrate out of the United States as soon as they complete their degrees. Some look at Canada, others at Australia, some at South Asia. These are all young people who see the handwriting on the wall, which reads as follows:

    “This empire’s sinking, baby! All able rats abandon ship, or else drown with it.”

    This empire is quickly sinking into a cesspool of self-consuming fraud, poverty, and violence. Maybe us old fogies should take a cue from these kids, for a change.

    1. Capo Regime

      Those students have the right attitude. Like Ives I lived in Australia, and let me tell you getting that 457 worker Visa is tough. Getting to Aus or Canada for the typical U.S. young person who attended an online school is virtually impossible. Better chances south america, but U.S. citizens lacking high end or unique skills, lots of capital will have very poor prospects as immigrants to other developed countries. Perhaps as things get worse they (we) can become boat people refugees and hope for Asylum in Oz or NZ……..

      1. Psychoanalystus

        In addition to US, I also have a few EU citizenships, but the EU’s another undesirable hellhole. We’ll spend some time in Australia over the next year to check it out close up. I’m thinking that one way that might work for my family is through my wife, as Australia seems to need dentists, with straightforward licensure and a clear path to citizenship. I think that visa is the “Independent Migrant Visa (Subclass 175)”. This way our 5-year old daughter might have a more promising future than that offered by the US or anywhere in the EU.

        If we ever make to Australia, I’ll be “Vinny”, the rough-looking “bouncer” at my wife’s surgery’s door, collecting fees and extracting healthy teeth the old fashioned way from non-paying patients… :)

          1. skippy

            That dog left for a reason. If it does come back, tail between the legs, it has a few questions to answer too…first.

            Skippy… Australians don’t mind a few Larrikins, but, he went to far[!] too many times!

    2. Someone

      For sure this will happen. Labour mobility is of paramount importance. Many of my friends are looking at mining jobs in Australia, bioengineering research in Singapore, practicing medicine in Dubai, and banking in Hong Kong. No one expects the US hegemony to continue. At best it won’t implode under its dysfunctional government and outdated Constitution.

      Asia is where it’s at for now, with Latin America a close second. I’m seeing lots of expats moving to Brazil fueling the boom. It’s like the wild west all over again!

      We all share the view that it’s not unpatriotic to emigrate. After all, it seems that the country doesn’t give a damn about its citizens. Why should we return the favour when jobs aren’t available to be had?

      The only impediment is the lack of a Schengen-like freedom of movement among countries. Applying for work visas is a bit of a drag.

      1. Psychoanalystus

        Indeed. I fully agree — that’s what I also see among my friends and colleagues. Many people have “Plans B”.

        I fear things can deteriorate quickly here, with Marshall Law and closure of the borders. I think Hank Paulson meant it when he threatened Congress with Marshall Law.

  41. George Belden

    I have owned a residential roofing company in Silcon Vally (suburbs south of San Francisco) for 20 years. Since the Market peak in 2007 we have had our ups and downs but overall have held in there really well. As I always do my marketing by subcontractors and distributors know that if my company is not busy than no roofer really will be.

    In 2010 a lot of pent up demand gave us one of our best years in a long time. I really do think our area has not been hit as bad as outher areas of the country. For 2011 I figured business would be a little better or a little worst than last year. Business through May led me to believe it would be better — but than it fell off cliff in June. I had the worst June in our 20 years of business. July came in at 2008 July levels so I adjusted our forecast to 2008 recession levels (which I would be happy with.) Unforunately August sales fell below the 2008 recession levels – we had our worst August in 20 years. The strange thing is that leads (request for quotes) have not really fallen off. It just seems like homeowners are afraid to commit 14K to a re-roof. I feel like I’m in uncharted territory now and look at 2008 recession levels with longing. My employees can’t help but see/feel the downturn in work and in turn cut back on there spending. I’m glad that I did not commit to new equipment purchases last year when things were going well and yet can see the irony in why the ecomony is slowing down (more like falling off a cliff.) Only silver lining I see is that these roofs will eventually need to be done and I hope I’m still here when that time comes.

  42. rps

    At this point in time, the “privileged” (or preferred “elites”) are not concerned with the disparaging incomes of the subordinates; their employees and the non-income class. The elites wealth/incomes are buffered by government’s intervention on their behalf. Media psychological perpetuation of imposed racial, gender, and sexual prejudices aught to keep the proletariat’s fighting amongst themselves for the meager tablescraps thrown our way.

    Until a cooperative rebellion that crossovers race, class, and gender, nothing will change. What made Bacon’s Rebellion(1676) remarkable was the cooperation of slaves, servants, and landless free against the elite. The after-effects was the elitist’s institutionalization of racial identity and gender division. Divide and conquer. The elites sit in the eagle’s nest watching from above most assured that the bought public administrators and military will protects their interests.

    1. G Marks

      Wasn’t Obama the quintessential CROSSOVER CANDIDATE?

      I bought the whole package. I laughed and cried with him. “YES WE CAN!”, but I too, noticed rectal bleeding after a few months. Was it my imagination?

      A vote for DEMOCRATS in America is a vote for illegals, minorities, gays and, and, …Big banks, Wall St and more war.

      Those of us who shudder at the cultural agenda of the left, have no where to go.

      I read news sites on the left and right. Townhall, Free Republic, Newsmax, AND Huffington Post, Salon, Politico etc.

      Members at all those sites agree on a few things.

      They want illegals deported. They want the TSA reined in or abolished. They want the wars to end. they want taxes to be consistent and less complicated. And they all hate Congress, but for differing reasons.

      Visit any thread on these subjects and the responses are identical, yet there is no candidate for that majority.

      Conservatives don’t want to lock up women who have abortions. We want to be protected from the cultural left and all it’s perversions.

      But Obama cured me for good. I will NEVER get sucked into campaign rhetoric again. They talk – we cheer – then they serve their real masters.

      No matter who I vote for, the war machine, the banks, Wall st and the multi nationals will win.

      No matter who I vote for – Israel will keep killing Palestinians in my name, Oil companies and nuclear plants will despoil what’s left of the planet.

      Janet Napolitano’s bull dykes will still be groping my grand daughters at the airport. Illegals will continue to make an emergency room visit impossible, and our children will learn less while teachers try to deal with the flood of non English speaking kids… who don’t belong in our schools.

      Everything listed on this thread will continue to erode and degrade the American experience – because NOBODY will reshuffle the deck on politics.

      I have no voice, but I can cheer when I read about necklace bombs on the kids of the super rich – YES, you heard right.

      AND I loved the story about Billionaires gassed in their sleep in Corsican cat burglaries. Talk about innovation!

      We forget that the 3rd Estate in 1788 France was deadly coalition of peasants, merchants, and disaffected professionals like doctors and lawyers.

      It was the sans culottes who hauled the guillotines through the streets and sacked the McMansions. BUT THE MERCHANTS AND PROFESSIONALS GAVE THE THUMBS UP!

      it’s comin…

    2. rps

      The 1960’s Civil Rights Movement was the last major rebellion against the elite. We transcended sex, race, and class. Since Ronnie Raygun, the top one-tenth of one percent has been waging economic warfare against the rest of us.

      Economics is the platform of institutionalized inequality; the social engineering and categorization of human beings. The United States economic paradigm of human categorization, sub-categorization, and pigeon-holing; is premised upon socialized constructs of genderization and racialization.
      We have been mass conditioned to blindly participate in the discrimination of our fellow human beings. Discrimination is taught, practiced, and lastly encoded into our laws. It’s deeply ingrained as the norm for one purpose, to safeguard the economical success of the top tier. We fight and squabble over the portioning of the table scraps as the parasitical few feast upon our labor.

      Reformation of Economics is dependent upon all human equality without categorization.

      Two good essays: “Racial Formations,” by Michael Omi and Howard Winant 1986 and “Constructing Race, Creating White Privilege,” by Pem Davidson Buck.

  43. Someone

    Might be a bit biased in my observations, but most people here in my major upper midwest city are doing well. Industrials, health care firms, and biotech are all hiring. For those lacking education, I’ve seen plenty of hiring now signs for baristas, taxi drivers, janitors, and restaurant servers.

    All of my friends are doing well as well. They’re mostly finishing up graduate school, working in software, biotech, pharma, or finance. Granted, all of them have at least a bachelor’s degree. We’re all young, recent grads with low debt who entered the market when home prices are attractive.

    Where my parents live in Silicon Valley, things are also going well. Software companies are hiring like crazy. Many startup founders I know are having trouble finding and attracting talent. Google gave everyone a 10% pay raise. Hardware is at least stable and not doing mass layoffs. Biotech has suffered a bit.

    Housing in SV is hardly down much, maybe back to 2006 levels. We took advantage of the market and low rates to buy a second house and rent out the old one. In the midwest, prices are down as much as 40%. It’s a good time to take advantage for those of us just graduating and those who saved and avoided participating during the previous RE frenzy.

    One caveat is that many young people I meet these days are less interested in the long career in a single industry or working into the ground until retirement. The digital nomad lifestyle is much more attractive for youths today. The name of the game is to keep expenses low and practice geographic arbitrage – living in SE Asia or Latin America while earning USD or EUR by operating blogs. This allows them to enjoy their youths and have a good lifestyle and still save quite a bit.

    1. Psychoanalystus

      >> The name of the game is to keep expenses low and practice geographic arbitrage – living in SE Asia or Latin America while earning USD or EUR <<

      That's been working well for me. every other year I teach online in the US and live in low cost southern Europe. Virtually everything I earn here gets saved. When I am in the US, I work full time AND teach full time, and still can't save much.

        1. Psychoanalystus

          It might go on for another 2 or 3 years. These schools are milking the military and the student loan system while they can. I think the entire American education system is headed for a spectacular subprime-like crash in the near to medium term.

          I’m bullish on shorting outfits like Phoenix, Argosy, and the rest of the gang.

          1. ugsome

            Oh, I met one of these student-loan profiteers this summer–a higher-up at Education Management Corp, parent of Argosy and other outfits. In case you were wondering if he eats his own dog food, probably not. His daughter goes to a seriously posh private school, most definitely not a feeder for Argosy.

    2. decora

      “young, recent grads with low debt”

      i.e. you were able to spend 10,000 to 30,000 a year for the past 4+ years on a college degree.

      presumably, before you had your degree, you were ‘uneducated’, meaning you worked as a janitor, barista, or restaurant server.

      i would like to know how you worked as a janitor, barista, or restaurant server for 4 years, paying $10-30,000 a year for school, and came out with ‘low debt’.

      especially considering that $8.25/hour, Illinois minimum wage, is about $17,000/year.

  44. ugsome

    I was just in Freeport for a wedding. I spoke to a woman in a bar who worked in a Freeport jewelry shop. She says this year’s been a disaster. Many regular customers have not been back.

  45. Miguel Jones

    I live in Mexico, and take a month long motorcycle trip through the US west. We stopped in Van Horn, TX along the I-10 corridor, and were struck by how the motels there had dropped their prices from previous years. Two years we couldn’t find a motel there cheaper than $45/night. This trip there were several offering rooms in the neighborhood of $30/night. There were also a couple that had closed their doors within the past 2 years.

    I didn’t notice much difference in the price of rooms from previous years when staying in areas that are a bit more of a “destination” than Van horn, which is really just an exit on the interstate, albeit one with a lot of hotels.

  46. adsanalytics

    With the debt ceiling food fight out of the way Washington will hopefully turn to address the most important symptom (and arguably cause) of the slowing economy – the labor market.

    At this point neither the level of economic growth nor the number of jobs created is enough to lower unemployment. See the charts below.

  47. Heron

    I live in a regional sub-metro hub city in Texas (Bryan-College Station, pop~160000). Outside of the university that is, of course, a big player in the local economy, B/CS has also always been the mercantile hub of the surrounding counties, and as such, you’d see the same sort of stores in our malls and commerce developments that you talk about Freeport having.

    The narrative, of course, is that Texas has weathered the recession better than other states, but all one needs to do is drive around town and walk through Post-Oak Mall to see the lie in that. Most of the strip-centers in town have lost about half of their occupants, the quality of stores in the big mall, Post-Oak, has gone from high medium-end to, well, skeezy, and foot traffic there is way down with most customers not venturing past the anchor stores. Parking lots are emptier, developments have stopped mid-stream, even our two mega-theaters, which are really the only entertainment venues in town, are getting horrible business. Restaurants and hospitality still seem to be doing alright, but if we’re seeing this much pain here in the only major commercial market between Austin and Houston, I don’t even want to think about how hard it must be for the people out in the counties.

    1. Heron

      The pop number’s closer to 130000; my brain didn’t pick up on that until after I’d posted it for some reason.

    2. Psychoanalystus

      As I described above, you can see Rick Perry’s “Texas Miracle” lie in Houston as well. Houston is a total disaster, looking more third world every day. Malls are closing down and are being replaced by payday loans and pawn shops. There are 2, 3, or even 4 panhandlers on every corner, most suffering with obvious severe medical problems such as strokes and diabetes. In addition, there seems to be a guy holding a “We Buy Gold” sign at every other intersection. The roads are full of roadkill and mountains of trash, potholes like canyons, and nobody is mowing the grass anymore on the side of the road. There’s your Texas Miracle for you.

      Oh, and I forgot to mention. A few months ago, while I was still in Houston, city hall passed a new ordinance forbidding panhandlers from approaching the terraces of downtown cafes and restaurants where Big Oil and bankster fat cats are savoring their caviar and Dom Perignon. Yeah, we would not want the fat cats to be offended by the sight of some repulsive stroke victim begging for a few cents to pay for his medication, now, do we…

      1. Heron

        Sad and depressing, but not terribly surprising. The decades-long Republican project of building a rigidly class-based society has gone further in Texas than most places, and Houston has long been an excellent example of it. I’m not terribly well-traveled, but it has always struck me that, in the course of a 15 minute drive through Houston, you can travel from some of the best funded, best performing schools in the nation, to some of the poorest, most rundown, most ill-managed, lowest performing ones. And make no mistake, this is intentional; from the state Supreme Court throwing out school district tax revenue sharing to the 30 year campaign, beginning with TAAS, to tie school funding to ever increasing performance demands, to the continual impoverishment of struggling school districts to fund costly “charter schools” experiments, the Texas Republican party has been leading the way on all fronts in the great Conservative Social Engineering Project.

  48. John

    The is the 4th Labor Day in a row that I don’t get paid because I am not a full time employee anymore with benefits. In fact, I’ve only gotten 1 month of work this whole year. EAT THE CRIMINAL RICH!

  49. chris

    It does seem to make sense that bankers should be more personally accountable for their practices. There have been plenty of people that have gotten crushed lately over the drop in housing prices because they had to put their personal guarantee on loans even if it was for business purposes. Landlords with small apartment buildings or single family homes for rent often do not have the luxury of getting loans in their business name without a personal guarantee. I am sure thousands of smaller landlords (less than 50 units) could have restructured and filed for bankruptcy (like the Donald) and have kept their assets without getting wiped out. However, as it stands now if someone had 10 mortgages it is likely they are at least 100,000 under water and more likely about 400,000 depending on price of property and original down payment, length of ownership etc…..There is such a double standard here for the smaller business owner and the very large company. There has been devastation among those people who had put away money in to real estate for retirement and cash flow purposes. They have been wiped out with no safety net, while we see the donald in his billion dollar jet after restructuring more than once.

    1. Heron

      Your point about small landlords is an important one that hasn’t gotten enough attention throughout this crisis in my view. Plenty of these folks got wiped out when the crisis first hit, not because of poor investments or shady dealing on their part, but because of the wider collapse of the mortgage industry, the drying up of credit, or the scaling back of the national real estate chains in response to watching their investments go up in smoke. The housing industry was only stalled for a year or two instead of collapsing entirely in Texas, but the number of people who suddenly became homeless because the people they paid their rent to had suddenly become over-extended was impressive.

  50. educator

    For the first 120 years true Capitalism worked to make this this Country the most prosperous for the people while most Countries favored the elite class, and suppressed the populace. However 1n 1914 that all changed, and we now have crony capitalism that favors the elitists over the people.
    The IMF website talks about their goals for “World Governance”

    The WTO website talks about their goals for “World Governance”

    The IMF has created a a One World Currency to meet those goals

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