This one’s gonna make the housing bust look like a tree fort collapse.
Job losses INCREASE because companies come under pressure. That pressure leads to two scenerios…1) Lay offs and consolidation. 2) Business closures.
The problem with BOTH those events leds to Commercial Real Estate problems. As business contracts they close down un-profitable locations.
If we think that HOUSING was bad bet for BANKS??? Wait to you see how BIG they bet on commercial properties.
During the BOOM they loaned money on projects all over the country. That was BAD in some cases, but what was WORSE was the BUYING that went on in EXSISTING BUILDINGS…I have a HUGE new mall within 15 miles from my home. During the BOOM it was bought and sold 3 TIMES!!! For ever increasing amounts of MONEY…It just entered BANKRUPTCY last week…Some bank is gonna take it in the shorts on that loan. This happened ALL OVER the COUNTRY!!!
As our jobs loses increase those properties will come under INCREASING pressure. A big number of those properties WILL FAIL. And on it goes…