March 21, 2010
Rockford Is Improving
According to our local paper, fondly called The Red Star, only 25% of house sales in the area are foreclosure sales. Except that I know for a fact that the banks are putting off foreclosure as long as possible so as to avoid as long as they can booking the losses.
In Boone, Ogle and Winnebago counties in February, just 62 of the 243 recorded sales were from bank, mortgage or government agencies such as the Department of Veterans Affairs.And we haven't even started to tear into the commercial real estate bubble. It is only a matter of time. And then the housing market will re-collapse.
Good times? Only if you like breaking records. Take unemployment in the area.
Local economists weren't the only ones shocked by the jump to the Rockford area's January unemployment rate.As far as the statistics go I'm not counted. I'm retired on Social Security. And my mate? She works for the school system so her job will be one of the last to go.
And what is one of the biggest problems our city faces? Public employee pensions.
The debate over how to balance the city budget without cutting services has now zeroed in on the budget's ticking time bomb: pensions.Let me do the multiplication for you. And to make it easy we will say the obligation is $5 million for 550 people. That would be around $90 million a year in a city whose budget is $110 million a year. A total 30 year obligation of $2.75 billion. Roughly.
That is unsustainable. And that which can not be sustained will not be sustained. I see bankruptcy in the city's future. Some improvement.
Cross Posted at Power and Control
posted by Simon on 03.21.10 at 11:19 PM
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