...many hotel owners, in San Francisco and across the state, financed purchases or refinanced loans between 2005 and 2007 - when the hotel values were at their peak. Since then, hotels statewide have lost 50 to 80 percent of their value, meaning that many owners owe far more than their asset is worth.
It wasn't just San Francisco and it wasn't just hotels......office buidings, shopping centers, and commercial land deals were all financed with incredible leverage between 2005 and 2007 at the peak of the market. Many of these deals were done on a non recourse basis and little or nothing down.......the banks didn't care if the deals made sense....too many cents were being made with the credit default swaps and fleecing pension funds who were getting bribed to buy the nonsense loans.
And it wasn't just commercial real estate, it was home mortgages, municipal loans, HELOCS, credit card loans, auto loans, private equity loans, and commericial loans were all gushing between 2005 and 2007. Spending exploded and the prices of everything boomed. Profits were flowing, property values rising, and an incredible amount of taxes flowed into government making our politicians happy.
Now the game is over as the banks intentionally cut off the private economy from credit starting in 2007. Without credit the economy will evaporate and we are likely going to see millions of government jobs cut going forward.The California Department of Corrections and Rehabilitation said Monday it will issue 1,300 new layoff notices in Sacramento, Amador, Fresno and elsewhere after the assumed $1.2 billion cut to the department's budget.
The most amazing part of this situation is that we are just at the beginning of the defaults....and our soon to be reappointed FED chaiman Benny the B is telling us the recession is over?
Over 150,000,000 Americans are directly or indrectly dependent on government spending for their incomes. Now that revenues to government are evaporating.....how are these people going to generate an income?
Michael Moore will be coming out with a movie questioning capitalism in America.....any my guess is that as conditions deteriorate....... so will many Americans. One of Alstry's greatest concerns was the threat of communism becoming a possibility.....it appears that the Zombulator is going to cause so much economic distress, many Americans will soon start demanding change to our current system. When people lose everything, they lose it.
Many of you Fools still can't see it.....but you will soon.
Alstry warned you to prepare.....now 9.09 is almost here. When politicians have a choice between maintaining their jobs or your wealth......their jobs win everytime....especially when the bankers are financing them.