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LuckyOne

Things In California And Nevada Are Bad .....

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Our family just got back from a two and a half week trip to California and Nevada. It is a part of the world that I know well and noticed a few things that are much more obvious during infrequent visits than they would be when you are there all the time as constant small changes are imperceptible relative to changes viewed less frequently.

A few things really stuck out in my mind :

- Logistics facilties are almost empty.

- There are a lot of planes idled at a lot of airports.

- All but the best shops selling quality brands at cheap prices are empty. This includes outlet malls which were very busy a year ago.

- Restauants are empty. A place that we like in Vegas had exactly three of about 40 tables occupied. A year ago it was completely full. I felt silly having made a reservation.

- My neighbour walked away from his house. He was in neagitve equity. He came over to apologise as he would drive down the value of my house. A new social more I guess.

- Car dealerships are empty and have got good at reducing stock. I overheard a slesman saying "Ma'am, you can get a discount on any car in this showroom" when asked about discounts. The place sold higher end European cars.

- Car dealerships are starting to offer income protection plans and depreciation protection guarantees in a desperate bid to prop up sales.

- Estate agents are very frank about wanting to sell repossessed properties.

- They are also very frank about prices. One told me that a property for sale at #1.7 mm was worth $1.2 mm at most and would be lucky to achieve $ 1.0 mm. I think that this is why the drops in California and Nevada have been larger than they have been here and why volumes have picked up substantially over there and not here. Say what you like about Americans, at least their EAs understand how to survive.

- The number of businesses which have closed or are in the process of closing was a shock.

- There is a real sense that things are grinding to a halt and getting worse rather than better no matter what the economic statistics say.

It certainly didn't feel like we are anywhere near a bottom in California or Nevada. I think that some are getting a false sense of security from the recent economic statistics which are less bad than before. We are still in a self perpetuating death spiral in the real economy. It is easier to see in places which we visit less frequently than the places where we live and the daliy changes are almost imperceptible.

Edited by LuckyOne

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Thanks for your post. I'm off to the US myself shortly.

Things are getting bad here too from a business perspective, but certain people on here seem to be blinded by a constant drip of VI media feel good news. The fundamentals are awful.

For all of their bluster, there is a real sense of fear amongst the Americans that I spoke with that even the switch from capitalism to a populist, socialist approach can't save them. If the state can't save them, inflation is the only way out .....

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It certainly didn't feel like we are anywhere near a bottom in California or Nevada. I think that some are getting a false sense of security from the recent economic statistics which are less bad than before. We are still in a self perpetuating death spiral in the real economy. It is easier to see in places which we visit less frequently than the places where we live and the daliy changes are almost imperceptible.

Thanks for your post. I'm off to the US myself shortly.

Things are getting bad here too from a business perspective, but certain people on here seem to be blinded by a constant drip of VI media feel good news. The fundamentals are awful.

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