Re: deflation, its demand driven, demand is driven by wages:U.S. Commercial Property Loans Fall 54%, Bankers Say, Lenders are reluctant to extend credit as property values fall and unemployment rises

On Nov 6, 9:12 pm, phil scott <p...@philscott.net> wrote:
> On Nov 5, 8:37 pm, Nickname unavailable <Vide...@tcq.net> wrote:
>
>
>
> > deflation, its demand driven, demand is driven by wages:U.S.
> > Commercial Property Loans Fall 54%, Bankers Say, Lenders are reluctant
> > to extend credit as property values fall and unemployment rises
>
> >http://www.bloomberg.com/apps/news?pid=20601110&sid=an_OclpZ0iwk
>
> > U.S. Commercial Property Loans Fall 54%, Bankers Say (Update1)
>
> > By Brian Louis
> > Nov. 5 (Bloomberg) -- U.S. mortgage lending for commercial property
> > fell 54 percent in the third quarter from a year earlier, led by a
> > decline in loans for malls and shopping centers, the Mortgage Bankers
> > Association said.
> > The dollar value of loans dropped 56 percent for office properties and
> > 40 percent for apartment buildings, the Washington-based Mortgage
> > Bankers said in a statement today. Loans for malls and shopping
> > centers fell 62 percent and hotel loans declined 46 percent.
> > The credit crisis has driven $138 billion worth of U.S. commercial
> > properties into default, foreclosure or debt restructuring, according
> > to New York-based Real Capital Analytics Inc. Lenders are reluctant to
> > extend credit as property values fall and unemployment rises.
> > Commercial real estate prices have plunged almost 41 percent since
> > October 2007, the Moody’s/REAL Commercial Property Price Indices show
.
> > “Tight credit conditions coupled with scant demand for new loans mean
t
> > that commercial and multi-family mortgage originations remained low,”
> > Jamie Woodwell, the MBA’s vice president of commercial real estate
> > research, said in the statement.
> > The rate of defaults and late payments on property loans sold as
> > commercial mortgage-backed securities jumped more than fivefold in the
> > third quarter, to 4.52 percent from 0.8 percent a year earlier,
> > according to Reis Inc., a New York-based real estate research firm.
> > About $26.6 billion of CMBS loans were 60 days or more past due.
> > Rising Unemployment
> > The Labor Department will report tomorrow that the unemployment rate
> > rose to 9.9 percent in October from 9.8 percent the previous month, as
> > companies cut another 175,000 jobs, according to the median
> > projections from Bloomberg News surveys of economists.
> > “Businesses are still cutting back on fixed investment and staffing,
> > though at a slower pace,” the Federal Open Market Committee said in a
> > statement yesterday. The panel restated its plan to keep interest
> > rates “exceptionally low” for “an extended period.”
> > Job cuts lower demand for office space as employers house fewer
> > workers and rising unemployment has helped drive the nation’s
> > apartment vacancy rate to a 23-year high. Both make it harder for
> > landlords to pay their bills.
> > The Fed kept its benchmark overnight lending rate at between zero and
> > 0.25 percent, where it has been since December.
> > “Household spending appears to be expanding, but remains constrained
> > by ongoing job losses, sluggish income growth, lower housing wealth
> > and tight credit,” the FOMC said after meeting in Washington.
> > To contact the reporter on this story: Brian Louis in Chicago at
> > blou...@bloomberg.net.
> > Last Updated: November 5, 2009 11:23 EST
>
> commcl real estate is going empty fast... I went to a local sf calif
> insider commercial realestate good by event for
> one of the heavy players ten years ago,.,,, he derided the others in
> not so tactful terms for hiring their idiot sons to run the properties
> then  these out bid each other..... over spending by huge margins  to
> get new properties.. that would not pay off even when the market
> was booming
>
> those would be totally screwed now....they are probably not collapsing
> because the banks would be
> worse off if they did... the loans are in default but not forclosed on
>
> that entire mess seems to be hitting the wall now... huge white
> elephants, costs of taxes, interests and maintenance
> eating them alive,.. no way to get renters even at a discount.... and
> not enough to come close to floating the boat
>
> he derided them basically for being lying scum as well,,,, quite
> amazing... last name rhymes with 'rogue'   a very soft
> spoken man,, but his remarks were scathing
>
> Phil scott

anything done to fix this right now with band aids, is sure to fail.
its like a finger in the dike. we need a reboot, just as FDR did. it
will take years to overcome the damage done by crank milton friedman
economics.
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