^

Could you link to that WaPo series.  I'd be interested to see what they say about the Dayton area. 

 

I do know defense spending is driving a lot office development east of the city.  Its a key feature in Greene County growth and becoming one in the Research Park right on the Greene/Montgomery County line

It includes an interesting map as well. It was sold as seriously intense, but ended up just being rather informative.

 

http://projects.washingtonpost.com/top-secret-america/articles/a-hidden-world-growing-beyond-control/?hpid=moreheadlines

I think it was overhyped--and the online database, which was supposed to be the real jewel of the series, was a slick presentation of very little information.  It basically identifies only the existence of contracts, not much more.  "X company has a contract with Y agency" is about all the information the database offers.  It doesn't even offer the size of the contracts.

 

I'm sure there is a lot of interagency work duplication, but I read the entire article and spent probably 30-40 minutes poking around in the database and came up yawning.  They hyped it up as an expose of a shadow government.  It ended up just being a humdrum report on bureaucratic inefficiency and the fact that contractors sometimes charge the government a lot (and the government is willing to pay for it).  While I'm obviously no fan of those facts, I'm not sure they qualify as news, let alone a story this prominently touted.

It basically identifies only the existence of contracts, not much more.  "X company has a contract with Y agency" is about all the information the database offers.  It doesn't even offer the size of the contracts.

 

I guess a lot of this is...top secret?  Maybe the point is that the manpower and dollars are close-hold.

 

That map with the gradiated circles shows the number of contractors, but not the volume or size of the operations.  Still, some interesting info there.  Dayton really does stand out in the Midwest.  But Columbus has a small cluster too, for Ohio.

 

This why I say you have your finger on the pulse of Right Wing America here in Dayton, becuase this defense culture is pretty conservative (and quite suburban or wannabe small town).  But it does provide an economic 'floor' to the regional economy. Otherwise Dayton would be more like Toledo or Youngstown.  As it is the city remains an socioeconomic bantustan vis a vis the defense culture/economy in suburbia. 

 

I know I blogged on aspects of this:

 

The Defense welfare State

 

The Defense welfare State II

 

Technocratic Affluence in Greene County

 

Defense Earmarking for the Dayton Region

 

..so that should be enough to chew on.  But this is topic drift.  Perhaps we should return to the recession.  Particularly the housing recession since I think some new numbers out are more positive than last months (but a caution about becoming a 'variation victim')

 

 

 

Interesting article on the economic situation of local government

 

http://www.bloomberg.com/news/2010-07-27/job-cuts-of-500-000-next-year-predicted-for-cities-counties-over-budget.html

 

(can't seem to cut& paste any of it, but it goes something like this...)

 

US local governments may cut almost 500,000 jobs thru next year to cope with the slide in property taxes, decline in state & federal aid, and additional social service needs....

 

... basically moving to cut the equivalent of 8.6% of their workforce...

 

... report from a survey by the National League of Cits, the US Conference of Mayors, and the National Association of Counties...

 

... although housing prices peaked in 2006, property taxes paid kept rising until the first three months of this year....

Backto the Great Recession....

 

As regular readers of this thread know I occasionally post on the Warren County housing market.  Warren has recieved national attention as one of the fastest growing counties in the US, being part of the urban sprawl of Cincinnati and Dayton.  In short its part of the developing Cin-Day megalopolis.

 

So it's a good place to see the impact of the recession in one of the more economically healthy parts of the region.

 

The census building permit database provides monthly, yearly, and year-to-date cumulative totals of housing permits, single & multi-family, and also dollar volumes. 

 

For single family permits, the cumulative totals for the year in May (May 2010 is the most recent data point)starting in 2005, followed by the cumulative as a precentage of the years total, followed by the year total

 

2005: 946 (42.2%) 2240

2006: 745 (51.6%) 1444

2007: 491 (48.4%) 1014

2008: 316 (49.1%)  643

2009: 290 (45.9%)  632

2010: 270

 

...so one can see, so far, the cumulative total for 2010 is actually lower than 2009, so far.  Given the %'s we should be pushing maybe 600-700 units for 2010 for Warren County, unless there is a spike in permits later in the year. 

 

Also one can take a look at Zillow and see other downward trends.

 

Real estate is still in recession.

(from above)

 

"Many economists have suggested that the weakness of corporate balance sheets is constraining business spending and investment, and that this in turn is impeding growth and the recovery."

 

While this has certainly been demonstrated time-and-again on companies involved in leverage buy-out or a major take-over (ie Cedar Fair right now), a lot of companies have been reporting strong earnings right now and report siting on lots of cash.

 

At the same time, capacity utilization is down, so there is no need to invest in additional capacity.

 

And at the same time, consumers are showing concreate cuts in discretionary spending (to the extent possible), so future demand does not look as bright as companies would like.

 

HAVE WE REACHED A POINT IN THE ECONOMIC CYCLE where existing companies are acting in a 'cash-cow' mode, milking existing customers without investing in new development?

 

Have US customers reached a point where their spending pattern is "locked-in", and they have no room to change it.  Can't increase it because there is no additional income.  Can't cut it because they won't be able to remain a member of society?

 

Let's face it... a bigger chuck the paycheck is devoted to

1) housing than at just about any time in the past 50 years

2) Utilities, including new ones like cell phones, internet, cable, which are needed to function in society

3) savings for retirement

4) medical premiums paid by employees

5) transportation costs (car/insurance/maintenance) remain stubberly high

 

I've been saying for some time that there is a floor to the US economy, and it's much higher than other's have argued.  I say that consumers don't have a lot of discretionay spending in their budgets these days.  They are in an 'all or nothing' situation with their lives, needing to spend nearly all their paycheck to stay afloat.  Giving up on any of the 5 big areas I listed above means you drown.

 

Companies are good at cutting costs (employees)

 

I think companies are in a position to milk existing customers (both here and abroad) but see very little incentive to invest in new products. Sure, there will be some new gadgets and things, but overall, I think most American's spending is on autopilot and they can't change the course!

 

http://articles.moneycentral.msn.com/Investing/MutualFunds/why-are-ceos-so-cocky-these-days.aspx

 

Why are CEOs so cocky these days?

 

from the article...

 

One year into the economic recovery, a lot of people remain scared and angry.....

 

But things look brighter from the front office than from the cheap seats. Measures of confidence among chief executive officers have soared and remain high despite the recent debt turmoil in Europe and evidence the economy has hit a rough patch on the road to growth. Why? Cash flows are at record highs, adding to companies' already huge cash reserves. Earnings growth and profitability have been boosted by lower commodity prices and cheaper labor.

...so one can see, so far, the cumulative total for 2010 is actually lower than 2009, so far.  Given the %'s we should be pushing maybe 600-700 units for 2010 for Warren County,

 

600-700 new SFHs in Warren county is probably a 1.5% new-build rate for the county.  That probably matches the population growth at the moment.  Sounds like supply and demand are pretty well matched.

 

Is that your definition of a housing recession?

 

^

compare this to the Conference Boards release on declining consumer confidence.  Hmm. 

Giving up on any of the 5 big areas I listed above means you drown.

 

When will start to see more "floating bodies"?

 

As to Warren county housing, I'm not sure to what degree the builders "over built" during the boom.  Some, I'm sure.  But as you mentioned, they still continue to build at a decent clip, likely in sync with current demand.  I know they still continue to build near me in several developments, and people are moving into the new houses (I drive thru the developments on occassion).  Not sure what people are paying for these houses.

 

(of course, I was just give you a friendly jab about the recession thing. Of course housing is in a recession nationally, and way down in Warren county as well.  But as far as I'm concerned, it's not down far enough in Warren county.)

 

 

 

from CincyDad...

Giving up on any of the 5 big areas I listed above means you drown.

 

From Jeffery

When will start to see more "floating bodies"?

 

You will find them on the rolls of the various government programs and on the steps of their now-foreclosed homes.

----

edited:

 

come to think of it, you will probably find them living  back in their parents' houses, friends' basements, etc.

(from above)

 

"Many economists have suggested that the weakness of corporate balance sheets is constraining business spending and investment, and that this in turn is impeding growth and the recovery."

 

While this has certainly been demonstrated time-and-again on companies involved in leverage buy-out or a major take-over (ie Cedar Fair right now), a lot of companies have been reporting strong earnings right now and report siting on lots of cash.

 

At the same time, capacity utilization is down, so there is no need to invest in additional capacity.

 

And at the same time, consumers are showing concreate cuts in discretionary spending (to the extent possible), so future demand does not look as bright as companies would like.

 

HAVE WE REACHED A POINT IN THE ECONOMIC CYCLE where existing companies are acting in a 'cash-cow' mode, milking existing customers without investing in new development?

 

Have US customers reached a point where their spending pattern is "locked-in", and they have no room to change it. Can't increase it because there is no additional income. Can't cut it because they won't be able to remain a member of society?

 

Let's face it... a bigger chuck the paycheck is devoted to

1) housing than at just about any time in the past 50 years

2) Utilities, including new ones like cell phones, internet, cable, which are needed to function in society

3) savings for retirement

4) medical premiums paid by employees

5) transportation costs (car/insurance/maintenance) remain stubberly high

 

I've been saying for some time that there is a floor to the US economy, and it's much higher than other's have argued. I say that consumers don't have a lot of discretionay spending in their budgets these days. They are in an 'all or nothing' situation with their lives, needing to spend nearly all their paycheck to stay afloat. Giving up on any of the 5 big areas I listed above means you drown.

 

Companies are good at cutting costs (employees)

 

I think companies are in a position to milk existing customers (both here and abroad) but see very little incentive to invest in new products. Sure, there will be some new gadgets and things, but overall, I think most American's spending is on autopilot and they can't change the course!

 

 

 

There is a floor to the U.S. consumption economy and we have reached it.  There is no limit to what we can do if we convert back to a production/export economy.  I wish this was on the political radar screen but it isn't.

There is no limit to what we can do if we convert back to a production/export economy.

 

Unless governments want to buy products and dump them in a field to rot/decay, then isn't production capped at more or less what can be consummed?  For the past 30 years, the US has provided the consumers to meet the production desires of the rest of the world.  I don't think Europe is going to ramp it's US imports.  Do you think Asia and Africa are ready to step up their consumption of US production?

There is no limit to what we can do if we convert back to a production/export economy.

 

Unless governments want to buy products and dump them in a field to rot/decay, then isn't production capped at more or less what can be consummed? For the past 30 years, the US has provided the consumers to meet the production desires of the rest of the world. I don't think Europe is going to ramp it's US imports. Do you think Asia and Africa are ready to step up their consumption of US production?

 

It's closer to the other way around.  You have to produce before you can consume.  There is essentially unlimited demand for all goods at some price.  The question is whether a good or service can be sufficiently efficiently produced (and packaged, and delivered, etc.) to enable someone to sell it at that price.

 

America already exports a great deal to Europe.  There's no reason we couldn't export still more to Europe if we produced more things that Europeans want at an attractive price.

I don't know about producing being a good bet in a nation as post-industrial as America. The Blade did a feature on Toledo-built exports and found something pretty shocking. Despite all the collapses in glass, construction materials, and auto manufacturing, Toledo still ranks near the top of the nation's 100 largest metro areas when it comes to exporting goods.

 

Brookings released a study on this this week or last, and it had Dayton near the top for exports too, but the data didnt get beyond 2008.  Guess which industry cluster ranked near the top?  "Transporation Products" (ie automotive).  Guess which representative high-export firms Brookings IDed for Dayton?  GM and Delphi.  Oops!  Might as well throw that study in the circular file.

Brookings released a study on this this week or last, and it had Dayton near the top for exports too, but the data didnt get beyond 2008.  Guess which industry cluster ranked near the top?  "Transporation Products" (ie automotive). 

 

I suppose that auto exports makes sense, given that the auto industry has a special joint economic relationship with Canada whereby parts are not subject to a tarrif.  I wonder how Dayton, Toledo, and other cities would rank if we excluded Canadian exports.  We could narrow that to exclude just Canadian auto exports/imports, and I suspect the city rankings would change drastically.

^I don't know about producing being a good bet in a nation as post-industrial as America. The Blade did a feature on Toledo-built exports and found something pretty shocking. Despite all the collapses in glass, construction materials, and auto manufacturing, Toledo still ranks near the top of the nation's 100 largest metro areas when it comes to exporting goods.

 

Toledo has arguably the worst economy in America, particularly when looking at labor participation rates for men and trends in median income over the past decade. It's clearly in a race to the wage gutter. Toledo is deep in sh!t, and there seems to be no sign of a recovery in jobs with living wages. Modern manufacturing just doesn't pay what the jobs that were lost did. Most of the green manufacturing jobs are paying significantly less than jobs at Jeep and Chrysler. People that got laid off from jobs paying $20 an hour are now making half as much. Manufacturing is not offering much more than mall retail.

 

America's cost of living is way too high to support a manufacturing/export economy. Cities that promote manufacturing are paying the ultimate price in this recovery. There are few places where it's easier to cut wages.

 

I would not look to manufacturing as a long-term bet for a massive amount of jobs, but as a boost to the economy, it could still play a substantial role because we still produce, and can produce, a great deal.  Most people vastly underestimate just how dramatically productivity has risen over the past generation due to automation.  Automation substantially exceeds free trade agreements as a reason for the loss of manufacturing jobs in America.  Plants that used to require 5,000 workers now might need 250, and as you said, those 250 might include a fair number of lower-skill jobs than manufacturing used to be.  (There would also be some higher-end ones, though, in engineering, technical support, IT, and other fields necessary to actually design and maintain the more sophisticated equipment that made the plant that much more productive.)

Can't we all just keep playing nicely in the sandbox together? Usually the kids only do so until one realizes the other has been stealing toys or someone decides they have grown big enough to take a few shots. I think both apply here.

 

Chinese rating agency strips Western nations of AAA status

 

"China's leading credit rating agency has stripped America, Britain, Germany and France of their AAA ratings, accusing Anglo-Saxon competitors of ideological bias in favour of the West."

 

"Dagong Global Credit Rating Co used its first foray into sovereign debt to paint a revolutionary picture of creditworthiness around the world, giving much greater weight to "wealth creating capacity" and foreign reserves than Fitch, Standard & Poor's, or Moody's."

 

"The US falls to AA, while Britain and France slither down to AA-. Belgium, Spain, Italy are ranked at A- along with Malaysia."

http://www.telegraph.co.uk/finance/china-business/7886077/Chinese-rating-agency-strips-Western-nations-of-AAA-status.html

Where are home prices headed in the future? I think we are in for a noticable drop and this will put a lot of pressure on the economy.

 

Shadow Inventory to Push 2011 Home Prices Lower than '09: Altos Research

 

"House prices will continue to drop through the rest of the year and will begin 2011 lower than they were in 2009, according to a webinar hosted by Scott Sambucci, vice president of data analytics for Altos Research.

 

The culprit behind the forecast is the weight of the shadow inventory of homes yet to hit the market. But, Sambucci said, anyone who generalizes the size and length of time it takes to clear the shadow inventory will be wrong."

http://www.housingwire.com/2010/07/30/shadow-inventory-to-push-2011-home-prices-lower-than-09-altos-research?utm_source=rss&utm_medium=rss&utm_campaign=shadow-inventory-to-push-2011-home-prices-lower-

 

Fiserv Predicts Home Prices to Drop Another 4.9% in Year Ahead

 

"Despite recent increases in a number of the industry’s home price measurements, and even an uptick in the company’s own index of residential property prices, Fiserv Inc. says the gains will be short-lived. The Wisconsin-based information technology firm is forecasting home prices to fall by nearly 5 percent more over the next 12 months."

http://www.dsnews.com/articles/fiserv-predicts-home-prices-to-drop-another-49-in-year-ahead-2010-07-29

Down, down, down we go.

 

Pending Sales of Existing Homes decrease 2.6%

 

"The index of pending home resales dropped 2.6 percent from the prior month, figures from the National Association of Realtors showed today in Washington. Economists projected a 4 percent gain, according to the median forecast in a Bloomberg News survey. The expiration of a government tax credit on April 30 caused the gauge to slump 30 percent in May, the most since data began in 2001."

http://www.bloomberg.com/news/2010-08-03/pending-sales-of-existing-u-s-homes-unexpectedly-decreased-2-6-in-june.html

 

Maybe they will add some HELOC money with all these refi's in an effort to deal with deflation issues? The big banks have been getting free money and making a nice profit off of it. Why not throw some of this 'free' money at Main Street as well?

 

As Housing Programs Falter, Administration Weighs New Refinance Plan

 

"Rumors of a new government-led mortgage refinancing program have begun to surface. DS News has received word from sources inside the administration and from high-ranking executives at some of the largest banks, confirming that the White House is indeed considering a refi push that would allow homeowners to lower their monthly mortgage obligations by locking in today’s rock-bottom interest rates."

 

"Namely, a large portion of such efforts would be negated with high redefault rates expected on the refinanced loans, the bank said. Secondly, while a government-sponsored refi wave may help existing borrowers, it could penalize prospective new borrowers, as investors price in the potentiality of another government-driven refi wave in the future. And thirdly, refis would result in large losses for mortgage investors."

http://www.dsnews.com/articles/as-housing-programs-falter-administration-weighs-new-refinance-plan-2010-08-02

 

So, what might be next for all this mess? The economic data is clearly screaming double dip and the decline in US money supply and deflation concerns are growing by the day. Add in we have elections coming in November and you know they are going to pull some very ugly rabbits out of the hat. Stimulus 2 to the mega power may be on the way.

 

RBS tells clients to prepare for 'monster' money-printing by the Federal Reserve

 

"As recovery starts to stall in the US and Europe with echoes of mid-1931, bond experts are once again dusting off a speech by Ben Bernanke given eight years ago as a freshman governor at the Federal Reserve."

 

"Entitled "Deflation: Making Sure It Doesn’t Happen Here", it is a warfare manual for defeating economic slumps by use of extreme monetary stimulus once interest rates have dropped to zero, and implicitly once governments have spent themselves to near bankruptcy."

 

"The speech is best known for its irreverent one-liner: "The US government has a technology, called a printing press, that allows it to produce as many US dollars as it wishes at essentially no cost."

 

"The ECRI leading indicator produced by the Economic Cycle Research Institute plummeted yet again last week to -6.9, pointing to contraction in the US by the end of the year. It is dropping faster that at any time in the post-War era."

 

"Societe Generale's uber-bear Albert Edwards said the Fed and other central banks will be forced to print more money whatever they now say, given the "stinking fiscal mess" across the developed world. "The response to the coming deflationary maelstrom will be additional money printing that will make the recent QE seem insignificant," he said."

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/7857595/RBS-tells-clients-to-prepare-for-monster-money-printing-by-the-Federal-Reserve.html

Evans-Prichard was a figure from the Clinton era, part of the right-journo full-court press agains him.  But this is a good closer:

 

There is no doubt that the Fed has the tools to stop this. "Sufficient injections of money will ultimately always reverse a deflation," said Bernanke. The question is whether he can muster support for such action in the face of massive popular disgust, a Republican Fronde in Congress, and resistance from the liquidationsists at the Kansas, Philadelphia, and Richmond Feds. If he cannot, we are in grave trouble.

 

"...A Republican Fronde..."...great line.  I guess this would be the Parliamentary Fronde?

 

From the left comes Doug Henwood.  Former Wall Streeter and publisher of the "Left Business Observer" newsletter (ironically abbreviated as LBO), discussing opinion leaders' seeming push for an austerity program:

 

Jonesing for a Slump

 

Having successfully avoided depression through a massive, largely coordinated, stimulus program, the world bourgeoisie now looks ready to reverse it—some because they think it a success, and others because they think it was a failure. This is a very dangerous business.

 

>snip<

 

The short-term issue is, of course, that the economy is struggling to get off the mat, and not doing a very impressive job of it. After a burst of strength in job growth and consumer spending in the first months of the year, things faded notably as spring turned into summer. There are no signs yet that the economy is slipping back into recession—though the ECRI leading index (see graph nearby), which anticipates broad economic trends three to six months out, is falling back to the zero line after a strong showing late last year and early this. This suggests that the slowdown will be sticking around. And while the index has issued false alarms in the past, should it penetrate seriously below the zero line, the likelihood of another leg of recession would rise to near-certainty..

 

Note that Henwood speaks favorabley about the ECRI index, referenced in the Evans-Pritchard excpert upthread.  However, also note this caution before running around with hair afire shouting "Woe!" Woe!"

 

ECRI Leading Indicators Widely Misunderstood

 

Bottom line, neither the “experts” predicting that the sky is falling based on the WLI, nor the other “experts” indulging in misinformed WLI-bashing in an effort to discredit the super-bears, have a real clue to what the WLI is all about. We created the WLI not to be an infallible, stand-alone recession-forecasting machine, but as one small part of a much larger array of leading indexes (each made up of many economic indicators) — like the especially prescient U.S. Long Leading Index. This array amounts to a sophisticated sequential signaling system of the economy’s cyclical turning points. The WLI is designed to be interpreted in this broader context, and its message today is quite simple: A slowdown in U.S. economic growth is imminent, but a new recession is not.

 

...as has been indicated by some leading indicators I posted upthread from another source.

 

 

 

 

 

 

 

 

 

 

 

 

We road census hiring on the way up (with Wall Street and the FEDs cheering job recovery) and now we are riding it on the way down. What will be the spin for this?

 

Stocks retreat after disappointing jobs report

 

"The Labor Department said 131,000 jobs were cut last month, though that was primarily tied to layoffs of temporary census workers. The unemployment rate remained unchanged at 9.5 percent. Economists polled by Thomson Reuters had forecast 65,000 jobs would be cut last month and the unemployment rate would rise to 9.6 percent."

 

"Because of the cuts to census workers, investors were largely focused on private sector jobs, which account for most jobs in the country. Private employers added just 71,000 jobs, well short of the 90,000 expected by economists."

http://www.ibj.com/stocks-retreat-after-disappointing-jobs-report/PARAMS/article/21553

^ "Private employers added just 71,000 jobs, well short of the 90,000 expected by economists."

 

I think 71k vs 90k is in a tolerable margin-of-error.  What I found interesting is that the number of jobs created the previous 2 months was revised down by nearly 100k total.  Now that is not within a tolerable margin-or-error, IMO.

 

 

It's going to be a while before we are back to our highest levels of employment. Banks needs to start lending to new start up's and such. If not it will be very painful for years to come.

We road census hiring on the way up (with Wall Street and the FEDs cheering job recovery) and now we are riding it on the way down. What will be the spin for this?

 

As I mentioned before, based on BLS private sector employment numbers for Ohio, we have probably reached the year high in employement in June, and will plateau around this level for the rest of the year. Private sector employment numbers for Ohio for the year have shown a month-to-month growth, in a pattern equivilant to a non-recession economy of the 2000s. 

 

If employment numbers show a month to month decline after June, is when we have an indication that the economy is deteriorating again.  We will probably already see signs of this in other indicators, which are showing a slowing, but not a move back to recession.

 

 

 

The big question is in Ohio. Will you high someone fresh out of college or someone who's been unemployed for 2 years. We do have to keep the young ones in state.

Think of all the trillions that have been spent and we still got income decline. Home prices will continue to fall if incomes keep going down.

 

U.S. Incomes Tumbled in 2009

 

"Personal income took a hit in most of the U.S. last year with the only gains coming from government support, according to new data from the Commerce Department."

 

"Even though prices declined last year — down 0.2% from a year earlier as measured by the national price index for personal consumption expenditures — incomes fell even more. On average, personal income dropped 1.8% in 2009, following a 2.7% increase in 2007."

 

"In areas that saw gains, most of the increases came from the government in one way or another."

http://blogs.wsj.com/economics/2010/08/09/us-incomes-tumbled-in-2009/

 

A look a some of the midwest cities.

 

                (2009)  (2008)

Cincinnati - $38168 $39066 -2.3%

Cleveland - $29704 $30092 -1.3%

Columbus - $38242 $38741 -1.3%

Dayton -    $35344 $35526 -0.5%

Indy -        $38339 $39297 -2.4%

Chicago -  $43727 $45377 -3.6%

Detroit -    $37541 $39028 -3.8%

Lexington - $35696 $36413 -2% 

 

Dayton is interesting on this list. Since it has such a huge amount of government funded and government supported jobs, it had the smallest decline in income.

I remember a few years back when the economy started to turn for the worse.  All you kept hearing was that house prices were stalling.  Then someone reported that in the Midwest, the biggest problem people were complaining about wasn't house prices or even jobs... it was stagnant wages.  Seems like when the rest of the country was seeing house prices going up, they were also seeing wages going up (although not in the same percentage). Apparently not the case here in the MW.

 

On a different blog I was on at the time, the topic of salary increases came up and most people reported getting 3-10% raises that year, and similar raises the years before.  Then I and a few other MW people piped in about wage freezes and such.  No one from outside the MW could believe it, and said if it was true, we were losing to inflation and should move immediately.

 

So, stagnant wages in the MW have been a way of life for several years now without factoring in inflation.  When you do factor in inflation, the picture is not pretty.

The numbers posted are for Cleveland, TN.  Here are the right numbers.

 

Cleveland-Elyria-Mentor OH $39348 $40118 -1.9% 1.9%

 

My guess would be that as this is Per Capita Income, the decline probably represents lower employment more than anything else.

Dayton is interesting on this list. Since it has such a huge amount of government funded and government supported jobs, it had the smallest decline in income.

As they say in the Gem City, "feds, eds and meds".

 

If Dayton lost WPAFB, it really would be all over.

^Over as far as? It's not like a nuclear bomb would had hit the area.

^Over as far as? It's not like a nuclear bomb would had hit the area.

As far as Dayton having any substantial semi-stable employment base.  In just the last year or so Dayton lost NCR and GM. WPAFB is the last employer of any size that's still standing.  The region is better than "Dayton" I guess but as far as the city or the first-tier suburbs are concerned, large employers are a thing of the past.  That's not to say there won't be nice areas and stable jobs.  Maybe this blood-letting was a necessary step to rebirth?

Dayton may need to start building railroad cars and engines because that's the future.  It may take a few billion to start but it's better than doing nothing at all. They need to start businesses like that before some of these other metro's lock up that market for good.

Dayton may need to start building railroad cars and engines because that's the future. It may take a few billion to start but it's better than doing nothing at all. They need to start businesses like that before some of these other metro's lock up that market for good.

Yeah, that'd be great but unfortunately the government wants to tear down our GM plants which are in perfect running order and might be purchased by someone someday.  It's really a big, bad mess.

Never day never, Hampton Roads is about to get a knee to the groin w/ a couple big closures and I'd guess the U.S. military will be 2/3 the size it is today in ten years time. We simply can't afford it.

^Mostly just don't need all this capacity.

In the words of Gomer Pyle, surprise, surprise, surprise. If this data holds true than GDP would have fallen from 3.7 to 1.3 within one quarter. That is a pretty quick haircut. This would probably mean that the peak of the stimulus took place at the beginning of 2010.

 

GDP much weaker in second quarter, economists say

 

"The markets might face their biggest downside economic surprise of this recent growth slowdown yet in the form of a downward second quarter gross domestic product revision, which today's U.S. trade deficit figures suggest will be a whopper," wrote analysts at Action Economics."

 

"Instead of growing at a 2.4% annualized pace in the second quarter, real gross domestic product will likely be cut almost in half to a 1.3% annual rate, according to economists surveyed by MarketWatch."

http://www.marketwatch.com/story/whopping-downward-revision-for-q2-gdp-seen-2010-08-11

^You can easily do a little research to find out that most of direct job creating portions of the stimulus (meaning the part that doesn't include tax cuts or direct aid to states or the unemployed) hasn't even funded yet.

^You can easily do a little research to find out that most of direct job creating portions of the stimulus (meaning the part that doesn't include tax cuts or direct aid to states or the unemployed) hasn't even funded yet.

 

What programs would that be?

 

If you are talking about the contract, grants and loans portion of the stimulus, then about half of that has been paid out. From what I am seeing on a local, and state level most of those funds have been appropriated, but about half the work may still need to be accomplished and/or is currently underway. There is a lag time between work and pay out with these types of funds.

 

If you look how the first half of those funds have affected employment numbers national, unemployment and job losses continue to not improve. This leads me to believe that the other half of these funds will have about the same impact.

 

What I have been seeing is that these funds have haulted the layoff scene in some industries. But, highering has not noticably increased.

 

If you are talking about other stimulus funds I would like to hear you take on this.

http://www.recovery.gov/Pages/home.aspx

Ohio foreclosure activity rises 23% in July

 

"Ohio Foreclosure activity got off to a rough start in the second half of the year, jumping more than 20 percent in July as filings declined nationwide, according to new data from RealtyTrac Inc."

 

Read more: Ohio foreclosure activity rises 23% in July - Dayton Business Journal

http://www.bizjournals.com/dayton/stories/2010/08/09/daily30.html

Ohio foreclosure activity rises 23% in July

 

"Ohio Foreclosure activity got off to a rough start in the second half of the year, jumping more than 20 percent in July as filings declined nationwide, according to new data from RealtyTrac Inc."

 

Read more: Ohio foreclosure activity rises 23% in July - Dayton Business Journal

http://www.bizjournals.com/dayton/stories/2010/08/09/daily30.html

 

something doesn't seem right as an article dated July 19 and linked to the above article states

Foreclosure rates climb in most metro areas, including Kansas City.

 

So which article is correct?  :?

What I have been seeing is that these funds have haulted the layoff scene in some industries. But, highering has not noticably increased.

 

It has halted layoffs in the public sector- mostly teachers, and also some police officers and firefighters. The majority of Americans do not support these federal bailouts of state and local institutions, so how long this will last is up in the air.

 

Growth in the private sector has been a complete joke. I would have rather seen this money go to the private sector than the public sector. This all comes at the expense of private sector workers and certainly will lead to future tax hikes and future layoffs. I doubt the stimulus has saved a single private sector job outside the hyper-corrupt finance industry and infrastructure construction. Whole entire segments of our economy are being completely screwed over.

 

This is going to get really ugly when the second leg down hits and the student loan crisis finally is put on the radar (closing in on a trillion dollars now, and will eventually eclipse the mortgage crisis). Young people already know about this, but the pro-education lamestream media have barely touched it.

 

While I agree that some of this is clearly going to the public sector, the private sector has seen its share. I have talked and seen many people in the private sector (engineering firms, planning firms, etc.) that were down to almost no work before the stimulus. But, since the stimulus they have secured significantly more work. The problem is many of them are now completing the planning, engineering and designing of many of these stimulus projects and that positive impact is starting to drop. The impact now is in the construction trade industries that are building these stimulus projects. Buy the end of the year I think we will see this category of stimulus at about 75% spent.

White House Economist Christian Romer regrets saying jobless rate would stay below 8 percent

By Lori Montgomery

Washington Post Staff Writer

Saturday, August 7, 2010

 

As she prepares to step down as President Obama's chief economist, Christina Romer said Friday that she wishes she could redo one of her first official acts for the president: last January's forecast that a big shot of federal spending would save millions of jobs and keep the unemployment rate under 8 percent.

 

The forecast was wrong.

 

more: http://www.washingtonpost.com/wp-dyn/content/article/2010/08/06/AR2010080606271.html?hpid=topnews

 

What else are they not telling us???

What else are they not telling us???

 

I am sure some of it we don't even want to know.

^^ I think there are two big crash leaders on the very close horizon: a bursting of the commercial real estate bubble and the Canadian residential real estate bubble. Both of these markets are behaving very similarly to what happened in housing in 2007--a very sharp rise in prices combined with a sharp decline in sales volume. Miami will probably see it first as a few new office towers came online in the last few months less than 40% occupied. One company strategically defaulted on over a million square feet of office space in L.A.

 

This is going to bring us some pain job-wise, but not as much as the housing bubble did to the construction market. If we hold tight and don't meddle in the market, the foreclosures can be processed quickly, put into hands of investors who will charge reasonable rents, and private-sector employment will rise as overhead falls. But of course, Congress will do something stupid and perpetuate the crisis for years by paying the owners to avoid foreclosure.

Don't banks need people with good credit to loan? With all this downtown and foreclosures, 10's of million of people s credit are SHOT. That's a potential of 10's of million of new businesses that will not be formed unless they have cash.  No wonder free checking maybe a thing of the past. We can rely on new students with no credit history to help us out of this. :(

I think it's dead-on to predict Miami will be where the second leg down begins.

 

Little-known fact: Miami was also a real hotbed of bubble-esque construction up to 1929. It has a long history as a cesspool of speculators and hype machines.

 

I expect Ohio won't get hit as hard this time. Only really Dayton and Toledo have much more to fall. I expect Toledo to go down only a little bit more since the auto industry has cut to the marrow.

 

These are my thoughts exactly. Ohio has essentially been in a recession since 2001. We have been dealing with this foreclosure crisis since then, and most of the population that had something to lose in a cyclical recession has already lost it. The employment centers have already moved away, the international capital dried up years ago, and we've been written off for dead. The benefit here is that we've proven to the rest of the country that we are stable even if in a recession, which I believe will become far more valuable than any other indicators like growth or construction. If you look at Case-Schiller for Cleveland, the housing market stayed the flattest out of all the top 20 MSAs in the nation. Nothing happened here. The malinvestment wave simply skipped over us. I think this is going to prove to be a very important asset moving forward.