Headlines – Week of October 24, 2010
October 29, 2010
Bank Failures Near Record Pace
2010’s bank closures have nearly reached a milestone. This year’s number of failed banks, 139, is now almost equal to last year’s total of 140–with more than two months left to go.
During the last great era of failed banks in 1988 and 1989, 763 banks went under compared with 280 from the beginning of 2008 to present.
However, the total assets of the ’80s failures, translated in 2005 dollars, was $309 billion. The total assets of the ‘08 and ‘09 failures was $473 billion, with many billions more to come by the end of 2010. A large portion of these assets were a result of the WaMu, failure which had $307 billion in assets just before in was seized by the FDIC.
Jobless Rates Down in Nearly Half the States
On Friday, the U.S. Department of Labor reported that jobless rates decreased in 23 states in September, but rose in 16. In 11 states, there was no change. The national average is 9.6 percent.
Nevada retains its unwanted title as number one unemployed state, with an official rate of 14.4 percent in September. Michigan is still number two at 13 percent. Thirteen other states had rates above the national average, while North Dakota retained its place as most-employed state in the union at 3.7 percent.
Housing Recovery Predicted for Late 2012
According to a housing outlook report by The Concord Group, a real estate strategy firm based in Newport Beach, CA, national home sales will recover by the fourth quarter of 2010, with some well positioned markets improving by late 2011 or early 2012.
The company says these markets have the strongest long-term growth potential:
- Orange County, Calif.
- San Jose, Calif.
- Washington, D.C.
The company’s housing demand model incorporates published employment forecasts, structural household growth, turnover, and obsolescence.
The firm predicts that development of quality new housing in core employment centers is expected to be a major opportunity and meeting the needs of baby boomers, highlighted by their transition to urban areas, should remain a focus of home builders.
U.S. Business Travel Spending, Trips to Increase This Year
According a newly developed quarterly business travel forecast. from the NBTA Foundation, U.S. -originated business travel spending is expected to grow 3.8 percent this year compared to 2009 despite expectations that economic and business travel growth will slow through the second half of 2010, The education and research arm of the National Business Travel Association (NBTA), found that business travel will continue to advance by 6.7 percent and 6.9 percent for 2011 and 2012, respectively.
The new report contains the first Business Travel Index (BTI), a headline measure of the current and projected level of business travel in the United States. At the last industry peak in late 2007, the NBTA BTI reached 120. Two years of the Great Recession left the BTI at 96, a decline of nearly 20 percent. The BTI has recovered to 106 currently and is projected to reach the level of the previous peak in late 2012.
The total number of U.S. business trips saw a sharp decline of 15.6 percent during the Great Recession from 511 million trips in 2007 to 431 million in 2010. The decline was driven in large part by the drop in transient business travel, comprising 60 percent of the total, as a result of tighter travel management, shortening trips, and some use of technological travel alternatives. However, through 2012, transient travel is expected to advance 31 percent as the economy continues to recover and travel restrictions are lifted.
Posted by Scott R. Lodde