The MOTHER of ALL BUSTS
4 Airlines shut down in one week. Aloha, ATA, Champion, and Sky Bus.
ViCorp Restaurants filed Chap 11 on Friday closing 56 restaurants. ViCorp was founded in 1958!!!! Boom there goes another 1750 jobs plus likely much more as the company reevaluates remaining locations under bankruptcy protection.
Unemployment skyrocketing. Gas over $3.50 per gallon.
April 5 (Bloomberg) -- The jump in March bankruptcy filings is another indication the U.S. economy is in recession, led by states where the housing boom turned to bust.
The more than 90,000 bankruptcy filings in March were the highest since insolvency laws became more restrictive in October 2005, according to statistics compiled from court records by Jupiter eSources LLC. At a daily rate, filings in March were 30 percent above the pace in 2007.
I just got back from visiting properties in Palm Coast, North of Daytona Beach, FL. It is a pretty nice golf community area that just hosted a televised tournament last week. It's pretty funny, the people down there have no clue what is about to hit them. CTX has exposure in the area. It just GAVE a golf course back to the city.
Based on the meetings I had, Florida is in a mess and about to get down right ugly. Upscale communities about to go bankrupt. Who is going to maintain the three pools in each community, keep the perfectly manicured landscaping updated. During the early phases of selling, much of the cost was taken upon by the developer as a cost of doing business.....now that many developers are on the brink of bankruptcy....just wait until the homeowners get the bill. You think you are going ot want to live in a million dollar house with weeds growing all over the place and algae in the pool?
Cities that were used to getting tens of millions per year in impact fees have seen revenues slow to a trickle. Seven schools are closing in the Daytona Beach area alone.
Anyone who tells you this is a subprime problem is either misguided or lying to you. This is an income problem and as incomes decrease, more and more will become subprime. Individuals incomes are decreasing, businesses incomes are decreasing, and government income is decreasing(just wait until the impact from all the tax rebates).
Defaults are growing rapidly and about to EXPLODE. Your government, the banks, and analysts are simply trying to hide it as long as they can before the stuff hits the fan. Deposits in Florida banks are flying out the door as more and more are pulling from what little savings they have left to make ends meet. With fewer deposits, lending by Florida banks as become practically non existent. Without lending, no business growth and pink slips are being delivered everyday.
Now with the new tax legislation, in order to recover 2004 taxes, every builder and bank is going to be liquidating land in 2008 as losses must be realized this year(impairments don't cut it in the tax world).
LAND VALUES WILL CRASH BY THE END OF THE YEAR AS EVERYONE IS SELLING AT THE SAME TIME. TAX PAYERS, GET YOUR CHECKBOOKS READY.....You are going to owe the builders and banks that put you into this mess billions.
Airlines are going bust. Restaurants are going bust. Private builders are going bust. Individuals are going bust. Cities are going bust. Counties are going bust. States are facing huge deficits. A little birdy told me a lot more than just a few hundred banks are likely to go bust.
How can anyone stay in business if the credit that was so essential to success if now being cut off? Get ready for more bankrupctcies in 2008 than any year since the great depression.