A bit over a week ago, I took a drive to a nearby small city a little over an hour away. On the way there I took the main highway and on the way back I tried the scenic coastal highway dotted with expensive vacation communities which sprouted over the past decade.
What I saw was telling. There were 'For Sale' signs everywhere. On everything. Empty houses, empty condos, empty storefronts, empty commercial lots, used cars, used boats. There were even a few sizeable boats which were run aground or sunk and abandoned.
The recession is starting to pinch hard. John and Jane Q. Public are cutting back to bare necessities and doing their best to sell what ever else they own to raise cash.
All those closed businesses have let go former employees, who's shopping habits will cut back and eventually drive other businesses to fold up their tent and go home.
Eventually, empty commercial real estate will become a problem when the owners can't service the bank loans they used to build. Can we say Foreclosure Crisis #2? It's coming soon to a bank near you.
Anyone who thinks the past month's stock market rally is the end of the bear needs to consider the fact that the economic slowdown is just getting started. There's a lot of debt still out there that someone has to pay off or liquidate by selling any collateral pledged to cover the loan. Prices received for those sales will be meager at best.
If you still own stocks, now would be a good time to lighten up on your positions. IMHO.
How does that rate for a first attempt at a blog? I think I got all the typos at least. It's not much, but it's something.