Friday, March 23, 2007

Bend: TOWN IN CRISIS

Shake-up at Columbia Aircraft
Company replaces CEO, adds new managers, places 185 on furlough


Columbia Air has "furloughed" 185 more employees, after firing 59 earlier this month. The media & Columbia itself are going to do everything they can to soothe your jangled nerves with several Big Gulps of Bend Media Kool-Aid, cuz a compliant population is easier to sell unwanted homes to.

OK, first of all, virtually everything about this story smells thickly of BULLSHIT. They are saying Bing Lantis, long-time CEO & President, has "left the company" for personal reasons. OK, 100% BULLSHIT. We could ordinarily swallow this small sip of Kool-Aid if it did not coincide with a complete blowout of the top ranks (along with 185 other lower level souls). Lantis was fired, because Columbia is IN DIRE STRAIGHTS. This smells like a company THAT CAN'T MAKE PAYROLL. There is a distinct chance this place will CLOSE.

Surprisingly, there is actual acknowledgement of something I wrote a scant 2 weeks ago:

Roger Lee, executive director of Economic Development for Central Oregon, says he wouldn’t be surprised if the region’s large employers announce more layoffs this year. Last month, Bright Wood Corp., of Madras, laid off 140 employees and Culver’s SeaSwirl Boats Inc. announced it was moving to Minnesota, eliminating 170 jobs.

“There is some sorting out going on in the economy,” Lee said, adding that Central Oregon created more jobs from 2000 to 2005 than the rest of the state combined and that some companies need to cut staff to increase their productivity and efficiency.

“The sky’s not falling; we’re still healthy here,” he said.


Interpretation: This guy knows full well BIG LAYOFFS are coming. OK, the SKY IS FALLING. Here's a vocabulary lesson:

SORTING OUT = "YOU'RE FIRED!"

Bend is a town in economic crisis. I have written about this till I'm blue in the face. Cali conveyor belt of money starts, housing gets hyper-hot and begins to feed on itself, we buy Hummers, kayaks, prime rib, Bachelor advertising and other quickly depreciating items to dissipate the wealth, instead of bringing in anchor tenant employers. We are finally going to roast in economic hell for this.

This makes me revise my own personal forecast for the implosion of Bend, and bring the Day of Reckoning closer. I used to think we'd grind lower over the course of a decade. I now think we'll implode over the next 2-3 years. This may be seen as good news: the faster we crash & burn, the quicker we can get back to "Real Life".

I saw several things on KTVZ last night that bolster this. 6 (SIX!) mortgage brokers have CLOSED in Bend in the past TWO WEEKS. That is INCREDIBLE. Bend Is "Sub-Prime Central". The entire character of this place is subprime: Subprime, to me, means that prices far outstrips buyers ability to pay. This applies to SO MANY Bend home buyers of the past 4 years. Cascade Bank will, at some point, be seen as a sub-prime lender. EVERY loan in Central Oregon (practically) is a very risky loan. This area is about to have a financial contagion on par with the S&L crisis: crap being built with easy money that cannot be sold to anyone. That describes this place perfectly.

I also saw that 30% of the people here are fed up and ready to leave! I have stated over and over that this place is being run by people who want to run with the Big Dogs and be a "mover and shaker", NOT public servants. hence we've seen just about every ill-conceived load of shit slide right by our City councilors. They are idiots, for the most part. PEOPLE ARE SICK OF IT! It's not just me and some other edge-case nuts. About 1/3rd of the population is fed-up with incompetency in how Bend is being run. Not just "a little unhappy": FED UP & READY TO LEAVE.

We're going to have to pay the piper now. We've squandered the possible spillover effects of funneling the California liquidity tsunami into anchor tenant employers, and bought Hummers and filet mignon instead. We're going to pay for that. Building permits DOWN 63%. That means MORE UNEMPLOYMENT. LOTS MORE. The BAD OLD DAYS are roaring back. Crook & Jefferson counties are almost back to DOUBLE DIGIT UNEMPLOYMENT, an evil that just 6 months ago we all believed we had banished to the historical dustbin. Bend unemployment is ROARING HIGHER.

We are in DEEP SHIT. There will be a wave of bankruptcies coming soon as the Bend liquidity contagion becomes an epidemic. Watch for jaw-dropping increases in unemployment. The crazy guy with the clapboards telling you the 4 horsemen of the apocolypse are coming is about to be proven DEAD RIGHT.

47 comments:

Anonymous said...

This whole 6-8 week furlough thing is total crap. They expect 20% of those furloughed to find other jobs. BS. Look for this "furlough" to become permanent for a hell of a lot of those people.

BendShopkeep said...

The crazy guy with the clapboards telling you the 4 horsemen of the apocolypse are coming is about to be proven DEAD RIGHT.

That's good!

I agree, we've blown our chance to make the economic good times stick. We should have thrown everything we had at Juniper Ridge, but no.

I don't know if it'll get as bad as you say, but I think we're on the precipice of some pretty hard times. The Spring & Summer selling season that are supposed to Save Us, will go out with a whimper.

adhor said...

I was especially flattered by Scott Steele's pigeon-holing of those critical of Bends recent ill-conceived growth:
Bend native and architect Scott Steele, who only moved away to attend college, then returned, can remember a far smaller town and far simpler time, of course, but says he wouldn't trade it for anything. And he calls those who are "vehement" in their criticisms of the negative impacts of growth the "CAVE People," for "Citizens Against Virtually Everything."

Any other groups you want to characterize, Steele? "COLORED People", they've always been a thorn in "our" side. How about "WOMEN People"? Giving them the right to vote probably really sticks in your craw. You can just tell this guy is a closet bigot.

Anonymous said...

BubbleBoy is spot on, but the present council doesn't bear all the responsibility for the mess -- the growth-at-any-cost mentality has dominated policy-making in this town for as long as I can remember, and that's more than 20 years. It's always been SOP to throw up the subdivisions first and worry about the necessary infrastructure afterwards.

Anonymous said...

In October, unemployment in Deschutes County was 3.5%, the lowest in the state. We're now 6th, with a 5.8% unemployment rate, in only 4 months. And this recent number doesn't count the impending Unicom blowout, or Columbia's masked firings, or other impending implosions.

This will get much worse, before it gets better.

IHateToBurstYourBubble said...

the growth-at-any-cost mentality has dominated policy-making in this town for as long as I can remember

I'm not so much anti-growth, as I am anti-waste. Bend City Councilors act like their on some sort of drunken orgy cruise, and that they are not accountable for anything. "What happens here, stays here" mentality. But whats "happening" is COSTING US A FORTUNE.

Hell, I love growth. I HATE flagrant waste. Bend is being run in true Enron-style, personal slush fund, old boy network, Boss Hog, the good times will never end fashion. No due diligence, no accountability, just spend like drunken sailors on dumb crap like there's no tomorrow.

Anonymous said...

The inevitable result of every liquidity crunch contagion, is mass, forced asset liquidation. The title holders try to sell to recoup the loan balance, fail, title reverts to the lender who will cut price without end to dump non-performing assets. That was what happened in the S&L crisis. I think inventory will go up here because people have absolutely no choice. The "buy at firesale prices" buyer always misses the idea that there is no lending going on at the bottom.

Anonymous said...

Wow. This post & the accompanying comments are a real eye-opener.

I consider my self a sort of even-keel optimist/realist, and I don't go for Prophets Of Doom type rants. But once you cast a critical eye on Bend media stories, you see that when there is a "storm cloud" story, they focus almost exclusively on the "silver lining". In fact, every story seems to be a "silver lining" story. "Growth will take care of everything" seems to be the party line. Columbia firing 1/3rd of the workforce? "Growth will take care of that." Will growth make their mortgage payments? Will the $500 "silver lining" re-hiring bonus do it?

I am going to start looking at things with a little more critical thinking than I have in the past. I feel I'm the victim of "Kool-Aid Coma".

IHateToBurstYourBubble said...

A comment from the post after this one:

Anonymous said...

My wife and I are just about "pack up our bags" status.

We want to buy a house, but the prices aren't coming down fast enough. Just months and months of inventory with no one apparently interested in a actually selling their houses.

The jobs suck. They pay LESS than other places we're looking at living, and he houses cost twice as much here!

Bend is a great city, but there are other great cities out there I like just as much with much better economics.

March 23, 2007 8:09 AM


I know people who moved here from the midwest 6 months ago, started work at Columbia, and bought a house. I feel awful for them. I KNOW they can't make their payments. This bubble will end in a wave of human misery.

Moriarty said...

Sounds like you are creating a self fulfilling prophecy. If you believe some thing will happen badly enough, it surely will.

Ill considered speculation about impending closure seems like a pretty stupid thing to propagate for someone who supposedly cares about the local economy.

One thing that can be said for sure; what happened at Columbia has got absolutely nothing to do with the economy, of the country or Bend. To proliferate such nonsense is to invite more doom. Columbia's customer base is very healthy for such a niche market.

Sure, heads have rolled; employees have been badly affected - all pretty typical consequences of tough breaks and bad management. Backing aside, for the most part, Columbia is a local company and had been run by local people. Who's to blame? The economy - yeah, let's blame the economy, that's easy.

Statements made by companies at a time like this reflect what's best for the company and investors, not necessarily the employees. After all they have had a few years now to make it work. However, if the changes work, then the people will again benefit - see the cycle here? It's kinda organic.

Columbia Aircraft has a fantastic product, the industry and customers know it and have poured accolades on it for years.

I'd suggest you focus your commentary on real estate, not that you are really helping much there either..

IHateToBurstYourBubble said...

Sounds like you are creating a self fulfilling prophecy. If you believe some thing will happen badly enough, it surely will.

Huh? This is Shoot The Messenger talk. Are you saying I'm more responsible than Bing Lantis, or Columbias other employees for the recent layoffs? Weird, man. I've been wanting Keira Knightley, a big yacht, and $5 billion in the bank... really "believing in it"... ain't happened yet.

Statements made by companies at a time like this reflect what's best for the company and investors, not necessarily the employees.

Bingo. This is the rub. It's All Good In Bend. Whether you're a mobile home resident being blown out, or an ex-Columbia employee, it's all good. The numbing effects of the Kool-Aid have left your genitals withered and useless...

I'd suggest you focus your commentary on real estate, not that you are really helping much there either..

Do you honestly think I am INFLUENCING anything? I don't. This thing is on the tracks, the hammer is down, and it's about to go off a cliff. I'm just a passenger in the caboose. I'm going to go down with the ship! I don't BENEFIT by what's going to happen.

Columbia Aircraft has a fantastic product

AGREED! But a fantastic product can only carry a mismanaged company so far. I don't know the ins and outs of what has happened internally at Columbia, but the external flailings bode poorly. This looks like a company on the brink. And as regular as the sun rises, we got our regular helping of Kool-Aid: The employees, they'll be OK. Bing Lantis, he needs to do some work in his garage at home. Would any other respectable news org ON EARTH take such bald-faced lying and print it unquestioningly? HELL NO! In Bend, it not only goes right in, the UPSIDE is the focus of the story.

If you think this is an "anti-Columbia" rant, you're wrong. It's anti-Kool-Aid. It's a "give me the truth, I can handle it" piece. I am tired of bullshit. I don't know what, if anything, I can trust in the news around here. I feel like I'm in Nazi Germany. This place is deranged. I'm trying to wake people like you up, for your own good. We are pulling hundreds and thousands of people who believe The Dream is possible here, frisking them of every dime, and tossing them out like yesterdays garbage. This place is designed to produce human financial devastation. And if the party ever stops, we'll all be destroyed, so it's them or us. That's why Bachelor is flogged in SoCal magazines even though its beyond 100% capacity. If the "spice doesn't flow", all hell will break loose.

Bend Economy Man said...

>> for the most part, Columbia is a local company

Actually, for the most part, it's a company controlled and majority-owned by the government of Malaysia.

I disagree with you that the housing bubble and the problems at Columbia are not connected. They are, I think.

Look at Columbia Aircraft. It wasn't doing so bad. It was considered a local success story. But no one stopped to think what it meant that the Malaysian government controls the company. It means that when the dollar's dropping, even when Columbia's a solid performer in local or US terms, it's losing money for the Malaysian government, who invested in the company back in the '90s, acquiring a controlling stake.

Consider this: the dollar has been falling like a rock against the Malaysian currency, the ringgit. Look at the graph on this blog entry going nuts about the dollar's downward trend and the expected further appreciation of the ringgit against the dollar.

For its Malaysian owners, Columbia, even if it's doing OK in Bend / Oregon / USA terms, is a money-losing investment unless it is profitable enough to cancel out the forex losses. So they kicked out the Bendite management who didn't realize this, and sent a Malaysian in to coldly and calculatedly cut costs and try to make the investment pay off (or, if he can't, they'll probably dump it).

I don't blame The Bulletin for not putting this together, because its reporters and editors probably couldn't find Malaysia on a map if you spotted them the "Malay."

Bend Economy Man said...

Oh, forgot to say why Columbia's problems and the housing bubble are connected.

It's because the devaluation of the dollar, and the asset value inflation we see in the housing bubble, were both caused by the Fed leaving interest rates too low too long and not forcing or even asking banks to adhere to minimum underwriting standards for mortgage loans.

jessefelder said...

What people don't get is that it is ALL interrelated. The local economy has done so well recently BECAUSE of the real estate boom. Now that real estate is beginning to fall apart, things will be especially difficult in Bend. The entire local economy will be affected - not just real estate. It's a vicious cycle of slowing real estate causing a weakening economy causing job losses forcing people to leave making real estate even weaker further hurting the local economy... Our 300 days of sunshine are slowly turing into a hard rain.

Moriarty said...

IHateToBurstYourBubble, thanks but my genitals are working just fine, bruised, but fine.. And I’m fully awake, more than you think.

Confidence in Columbia is shaky. The company needs support right now. I know you are not on an anti-Columbia rant. Take a look at any bulletin board associated with Columbia's product and you will find potential customers holding their breath, or more importantly, their wallet. I'm simply suggesting that comments such as yours spur people into the 'let's wait and see what happens' pot. Right now, that will kill Columbia. They need orders to continue flowing right now.

To think that you cannot influence anything through your blog is a little self defeatist don't you think. Have a little confidence, at least in your self.

If a company is worried about further damaging it prospects, what else do you expect it to come out and say?

The company is on the brink, your right - but on the brink of what? Failure or success, you choose - seems you've already chosen. The company's upside is worth promoting, it's the only thing that can save it. Go figure.

I can certainly sympathize with you on the anti Kool-Aid rant. Unfortunately it is what makes the business world spin. I'm sure we can all handle the truth at times, but in circumstances like this the potential customer and therefore the future of the company is the prime consideration. Hence the 'positive spin'. The customers aren't dumb either, in Columbia's case, they are invariably smart successful people. These people can read the small print on the Kool-Aid label and totally understand what is happening. From what I can tell, many see this as a positive and something that should have occurred a long time ago - one up for the Kool-Aid.

IHateToBurstYourBubble said...

Unfortunately it is what makes the business world spin.

Keyword being SPIN. This is part of what I see as something that has become a pathological part of Americana. Everything is SPUN. I HATE SPIN. Spin is probably what lead Columbia and others to the deluded idea that NOTHING IS WRONG.

OK, here's a plug:

Millionaires, buy a Columbia Airplane! Now!

I am DYING for places like Columbia to survive & THRIVE. They are the sort of place that can bring Bend as a whole back from the brink. But spinning isn't going to cure anything. We can't spin Columbia back to good health. More Kool-Aid ain't going to cure a Kool-Aid overdose.

Dude, you sound like a good, reasonable guy. But stop thinking that I AM THE PROBLEM. I had nothing to do with Seaswirl, Brightwood, or Columbia layoffs. Deluding ourselves is the problem. Thinking that if I stop blogging about it, it will go away, is indicative of Kool-Aid poisoning not my malevolence.

I'm not sure what can be done at this point, as I said I feel like the crazy guy in the caboose, as the train goes over the cliff. The engine has gone over, but everyone seems content to look around and say "We're fine! Look we're still on the tracks. Everything will work out." OK, the passengers on the Titanic thought that, insisted on striking up a band on deck, and casually made eventual plans to abandon ship, w/o mussing their hair. And several hundred people died who probably could have lived had the action been more direct and URGENT.

Moriarty said...

Bend economy man: Lancair, oops sorry, Columbia is a local company, and has been run by locals(kind off). Yes it is owned by the Malaysian government. However, they have not interfered much - probably why things got as bad as they have.

By the way, the outgoing CFO was Malaysian.

Can't fault your economics. But I think you have to think a little more about why the Malaysian government would even want to buy a stake in a backwater GA aircraft company in the middle of nowhere. On the face of it, does that seem like a savvy investment to you?

Maybe it was because they originally saw it as a the first step of a much bigger strategy, almost a loss leader approach. I can assure you of one thing, from what I have seen of the government’s 'carbon composites' business interests back in Malaysia, they are very happy with their contract from some of the major commercial airlines - Columbia - just a drop in the ocean.

As to Columbia being a loss, for the Malaysian's it's more likely to be more a matter of pride, given Columbia isn't really the reason they came here. Why else would they sink still more money by bringing in a team of no doubt very expensive restructuring consultants?

I'm sure that the Malaysians want to present the company to potential suitors as stable, profitable company. At say $500k a pop and three aircraft a week, that's $78M pa. A conservative valuation (however you choose to value), lets say 3 times revenue, means the company could easily return what they put in. I don't think they are loosing any sleep over this or Forex losses. I'm just surprised they let the problems go on for so long.

to me, the Bulletin is just doing what papers do - write stuff that sells papers. Sometimes it just seems that what they write is just Kool-Aid of a different flavor, and can actually damage further that which they profess to be so concerned about, as far as impartiality in reporting lets them.

Indeed, Malaysians are a pretty cool bunch, calculating even :) However, the guys actually doing the cutting are consultants from New York, if you Google the names.

____________________

IHateToBurstYourBubble -- I didn't say you were the problem, per say. I don't think any one person can do anything in partcular about the problems Bend faces. Seldom does this happen, invariable action occurs through collective will and intent. Sometimes the outcome runs contrary to individuals specific wishes, reflecting pervading sentiment instead - if that sentiment is negative, were screwed.

My advise? Go have a beer, buy a parachute and enjoy the ride, I'm on the same train and have no intention of running over a cliff.

ENOUGH IS ENOUGH! said...

Personally I think Mariarty is plain STUPID - finding the tiniest bones in everyone's comment except not looking into this own! His argument is WEAK and really, let's shall not waste any time on this guy!

IHateToBurstYourBubble said...

Personally I think Mariarty is plain STUPID - finding the tiniest bones in everyone's comment except not looking into this own! His argument is WEAK and really, let's shall not waste any time on this guy!

Dude, stick around. There have been some real zingers commenting here. I welcome well articulated comments. The guy cares... so do I!

I just want to get across that "spinning" the truth is how you run a Ponzi Scheme, not a business. I disagree with the idea that if we just turn our back on our problems, they'll go away. Woof. I can tell you that will not work, and only makes things worse. I know there are millions on the line, but no one seems to give a shit about the 185 poor souls who lost their jobs. If it was YOU, you'd care. If it was YOU, you'd wonder how you'd put food on the table. If it was YOU, you'd be real concerned about how the mortgage was going to get paid.

I'm NOT a Man Of The People, I just see this distortion of the truth as hurting EVERYONE. We need to WAKE UP, and start facing our problems. Kool-Aid ain't the cure, it's THE PROBLEM!

Anonymous said...

Well, my friends own a public-works construction company. They've had one heck of a time finding workers who stick - even at prevailing wage. I told them, wait 'til next year, they won't be demanding per-diem and all sorts of other things and still leaving.
My friends are good folks, and they will provide good jobs (with money that comes in from the state and Feds). So all is not lost. You know, things are sitting in Portland too.

Moriarty said...

you're right, Kool-Aid ain't the cure, i know that and hate it as much as you. I care a lot about the 185 and the 59 before them. It has happened to me 4 times before, enough to know you can do diddly squatt about it. That's the thing about trains and the one you are on, when they get started they are tough to stop, especially if they are on the wrong track.

Occassionally you get a chance to switch tracks. That's going to happen at Columbia, i'm sure. If it works, the company survives and people get jobs again - yep - that's plain optimism for you.

Bend is a much bigger train and I don't think everybody is convinced it's on the wrong track, just confused as to who's aboard and the ticket price.

Thanks, it's been interesting, i'm done for now.

Sean said...

"I also saw that 30% of the people here are fed up and ready to leave!"

Could you please explain where you "saw" or "read" this from? While I agree with some of your predictions, I feel you're exaggerating things a little.

IHateToBurstYourBubble said...

Moriarty... nice to have known you. You are welcome ANYTIME. I love people who can articulate their viewpoint.

Sean, here is a thread:

http://bendeconomy.informe.com/perfect-storm-of-bad-news-dt250.html

OK, read it. I don't defend this sort of stuff, I just report what I heard. Believe it or don't. I heard it on TV. Others heard it as well. It's a poll/survey on KTVZ.

IHateToBurstYourBubble said...

Sean, who loves you baby! Here's a tiny url:

http://tinyurl.com/35a486

IHateToBurstYourBubble said...

Saw this in todays Help Wanted section:

Boat Manufacturing ATTENTION SEASWIRL EMPLOYEES: Pro Sports Boats (a manufacturer of fiberglass boats) in Lincoln, Alabama is searching for QUALITY BOAT BUILDERS. Special search for Lamination Manager, Gel-Coater and RTM Tech., but also need all skill levels (Assemblers, riggers, chopper gun operators, QC and patchers). We manufacture a fiberglass saltwater series 18-37 ft. product. Lincoln, AL experiences mild year round weather and a low cost of living in a recreational lake community. Experience preferred. Excellent Benefits and Great Salary provided. To apply: e-mail patsmith@prosportsboats.com, fax 205-763-0035, or call 205-763-0231. Check our web-site at: www.prosportsboats.com

Good news for Seaswirl refugees...

Missy said...

Bama, here we come, humidity and southern nites, party on!!

It's all good buy real estate all over its a no lose proposition.

IHateToBurstYourBubble said...

Article in the Bulletin:

Region's economy continues cool-down
Business index reflects trends in housing, other areas


Excerpts:

Central Oregon is likely to see a significant slowing of economic growth in the near future, according to a new report.

The Central Oregon Business Index fell to 167.7 in the fourth quarter of 2006, down 2.7 percent from the previous quarter. The index, which is seasonally adjusted, was 0.7 percent lower than the fourth quarter of 2005, according to the report.

The falling index suggests Central Oregon's economy is leveling off after a three-year run-up fueled by a hot housing market, says Timothy Duy, the index's author and an adjunct economics professor at the University of Oregon.

Additionally, chances that the housing market - a driving economic force in the region - will soon take off like it did between 2005 and 2006 is unlikely, Duy said.

The local labor market was soft last quarter, which means employers hired fewer workers than in the third quarter. Help-wanted ads in The Bulletin fell to the lowest level since the third quarter of 2005.

Fewer new businesses were created last quarter than in the third quarter. The number of new businesses created was 19 percent lower than the peak in the first quarter of 2006.

The median number of days houses sat on the market climbed, as it had all year, rising to an average of 119 days on the market in the fourth quarter, the highest since the first quarter of 2004.

Berger, who has been in the real estate business for 20 years, believes new homes are selling for lower prices than resale homes because homeowners are having a tough time accepting that they have to list their homes at prices lower than eight months ago.

"You can't wait for the price you would have got last summer," he said. "That's not happening and it's not going to happen."

"The question, though, is: Was there significant overbuilding in the last couple of years that will take longer to work off than people expect?" Duy added. "Are people lacking equity gains in other parts of the country (that makes them unable) to afford housing in this area?"


This piece, like all, is interprersed with Bend Media Kool-Aid (Realtor = "real estate expert", Falling Index = "leveling off", etc.), but it's worth the price of admission for the graph. You can see that Cent OR never really suffered too much in the last recession in 2001, it more flatlined. There has been a far more sizable drop here in the past 2 quarters than there was in 2001.

And there is acknowledgement that the unsustainable housing market (ie BUBBLE) is The Cause.

"It's not in the history of bubbles to repeat themselves," he [Duy] said.

My Lord, they used The "B" Word! Of course, this & other forums have been saying this for quite awhile. Bubbles RARELY repeat themselves in the same place. They actually leave many places so economically blighted, that they NEVER recover to anything near their bubble peaks, EVER.

Midland TX homes are STILL cheaper than they were 25 years ago. Recent oil runup? Nope, not enough. The place is in a multi-decade economic malaise.

I'm not out yet, but I see Central OR entering a turndown that won't be corrected in any relevant time period, for me at least. That's like 20 years. I think we'll be saddled with white elephants (totally unneeded homes & buildings, built simply because the money was easy) for a long, LONG time. I, like many, will slowly leave this place, because it will become an economic black hole. Seaswirl, Columbia, Brightwood... all those people have a big incentive to leave. The only real bright (blight?) spot is the Madras prison. And there's something depressing about when the best job prospects in "paradise" is working at a prison.

People are going to start leaving good old Cent OR. Instead of sexy "I work as a Personal Success Coach!", people will hear, "I work the graveyard shift at a prison." Not good for inbound migration. Not sexy, not really a motivator for people who want to "live their dreams".

IHateToBurstYourBubble said...

The index, which starts at 1997 at a base index of 100

OK, more evidence of Kool-Aid poisoning: Look at the graph, starts in Q2 1997, looks like it's down around 92-93, or so. It started Q1 1997 at 100.

The Bulletin PURPOSEFULLY left out the first data point that shows a HUGE 8% DOWN TURN in the first quarter of 1997.

Bastards. Take a LONG look at that. The guy starts the index in 1997 at 100, it tanks immediately, and a full decade later, the local paper WILL NOT PRINT THE BAD NEWS. Over a decade old, and they won't print it.

Relax Bend, the Kool-Aid poisoning has left your brains withered and useless.

I want the truth.
"YOU CAN'T HANDLE THE TRUTH!"

Anonymous said...

And this index looks to be a real lagging indicator. Not only is the data measuring things happening pretty far in the past, it's almost April, and they're just coming around to telling us about the 4th quarter of last year.

It's really telling us that Q3 of 2006 was bad. Who doesn't know that by now?

Mordor said...

Anyone want to venture a guess as to how much of that huge runup starting in 2003 is due to the Central Oregon housing mania?

My guess is about 120% of it. I think we're headed back towards the 120 area on that graph. Realtors will say that's "normal". I call that a depression.

Anonymous said...

Correct me if I'm wrong, but this graph doesn't really reflect the "layoff fever" period of the past few months. I'll bet Q1 2007 is an even larger fall that Q4 2006.

And this index seems to be a real lagging indicator. It'll probably reflect the terrible Q1-2 2007 figures around the end of this year. The guy computing it should do it on a computer, not an timeshared abacus.

adhor said...

Bill Berger, principal broker for The Hasson Company Realtors, says although the housing market has changed, moderate- to low-priced houses - those costing $450,000 or less - have become the most active movers on the market.

Only in Bend Oregon would housing that is TWICE the national median be described (by a Realtor, of course) as "moderate to low-priced".

Anonymous said...

IHateToBurstYourBubble,

You are a prophet. The Bulletin address the misery today in Section G.

http://bendeconomy.informe.com/viewtopic.php?t=269

Tanker 101 said...

I really don't see this area tanking until So. California and other feeder markets start to REALLY tank. They're weakening, but I don't see them collapsing yet.

Anonymous said...

It depends on which city in California you're in. I'm pretty sure San Diego feels like they've tanked.

Anonymous said...

To Moriarty: The bubble is bursting not only in Bend, but all over the country. This from today's Washington Post:

"Sales of new homes plummeted for the second consecutive month in February, an unexpected drop that dashed hopes of an imminent recovery in the housing market.

"The U.S. Department of Commerce reported today that sales of new single-family houses dropped 3.9 percent last month to a seasonally adjusted annual rate of 848,000. Although the monthly decline was significant, even more telling was that it represented an 18.3 percent drop from February 2006's seasonally adjusted annual sales rate of 1,038,000."

The housing market bubble of the 2000s is much the same as the dot-com bubble of the 1990s, and the results of its bursting will be similar -- but much worse, because the amount of paper wealth that will disappear is much greater.

All speculative bubbles burst sooner or later, despite the best efforts of "positive thinkers" like Moriarty to keep pumping hot air into them.

Anonymous said...

Moriarty: "Bend is a much bigger train ..."

The bigger the train, the bigger the train wreck.

Anonymous said...

I have an idea, just blame Californians. That will solve everything, and it's much easier than fixing problems.

Anonymous said...

>>I have an idea, just blame Californians. That will solve everything, and it's much easier than fixing problems.

I think you're right. We should fix the problems.

But how do we start? Can we send them back to California?

Honky said...

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KTVZ reported that a Sunday-night fire in a southeast Bend vacant rental home at 651 SE Reed Market Road might have been arson. Looking on the Deschutes County Clerk's Web Query, the owner of this 942-square-foot house (purchased in November 2006 for $279,000) is simultaneously named as owner a number of other properties, all mortgaged, some mortgaged to such infamous subprime giants as New Century.

On an unrelated note, some bubble-watchers have speculated that strapped flippers might resort to arson to rid themselves of crippling obligations.

Honky said...

When you buy property in Deschutes County, you have to put down an address for property tax bills.

It's interesting to note that the owner of 651 SE Reed Market Road put down a different address (and not the address of the property in question) for every property he bought. Why would he do that?

He also partnered up in his deals with a guy with the same first and last name as him, but a different middle name. His dad?

Anonymous said...

Hmm. Interesting. I'm thinking this arson story deserves it's own blog entry.

IHateToBurstYourBubble said...

But how do we start? Can we send them back to California?

Build a wall?

You'd think a lot would turn around at Chemult, or at least La Pine... those Cali's are an obstinant lot.

IHateToBurstYourBubble said...

On an unrelated note, some bubble-watchers have speculated that strapped flippers might resort to arson to rid themselves of crippling obligations.

unrelated... Now that's funny!

That is some pretty slummy crap property, but a good location. Man, if there was just a way to get rid of that crappy house, so you could sell the land free & clear... Ohhhh.... right.

And his name is James J Pasmore. (one "s")

Anonymous said...

BENDOS -CAL THRASHER HERE. I WOULD NEVER HAVE MOVED TO YOUR "TOWN" IF I HAD TO ACTUALLY WORK HERE. YOUR ECONOMY IS A JOKE, AND NOT EVEN A FUNNY ONE. IF PEOPLE LIKE ME PULL THE PLUG, YOU'LL HAVE TO GO BACK TO MILKING COWS AND CUTTING DOWN TREES FOR A LIVING. THAT AND DEALING WEED AND METH SEEMS TO PULL THRU A GOOD NUMBER OF "LOCALS". THERE IS A NEW METH OR POT BUST EVERY WEEK OR SO, YOU CAN ALMOST COUNT ON IT. NOW, LET THE WHINING CONTINUE, IT'S ENTERTAINING.

Anonymous said...

BENDOS... CAL SHREDDER HERE. I'M CHANGING FROM A THRASHER TO A SHREDDER. THE LOCAL SNOWBOARDERS HAVE INFORMED ME THAT "THRASHER" IS NOT COOL ANYMORE, IT'S "OLD-SKOOL" I GUESS. "SHREDDING" IS THE NEW TERM. I'M DOING MY BEST TO FIT IN WITH PEOPLE HERE SO I'M NOW CALLING MYSELF "CAL-SHREDDER". CAL-SHREDDER OVER AND OUT.

eyepublius said...

"to me, the Bulletin is just doing what papers do - write stuff that sells papers."

No, they're writing stuff that makes their advertisers happy. RE ads account for an ENORMOUS portion of The Bulletin's revenue.