Wednesday, January 7, 2009

CRASH TALK

CNN - As more stores exit malls, vacancies in regional malls could rise past 7% by year-end, a level not hit since the first quarter of 2001, according to real estate research firm Reis. . . Many municipalities are heavily dependent on retailers for the tax revenue and jobs that they generate. For example, Montgomery County, Pa., gets as much as 50% of its tax revenue from the local King of Prussia mall. . . .The village of North Randall in Cuyahoga County, Ohio, is on the verge of extinction after a challenging economic and competitive climate has crippled business at the Randall Park Mall. The shopping center, once the largest enclosed mall in the greater Cleveland area, is closing after 32 years.

The International Council of Shopping Centers, in its most recent forecast, expects that 6,100 chain stores will shutter this year, the highest level since 2004 "as the U.S. recession continues to take its toll on the retail sector and its job market."

The ICSC projects that about 148,000 retail establishments - both public and private - will go out of business this year and another 73,000 stores will close in the first half of 2009.

The ICSC projects that about 625,000 retail jobs will be eliminated this year "with little change in the pace for early 2009."

World Socialist - For weeks, spokesmen for the incoming Barack Obama administration have suggested that they would respond to the economic crisis by launching a massive program of public spending, with some supporters comparing the scope of the planned economic stimulus package to Roosevelt's New Deal measures during the Great Depression.

Details of Obama's proposals began to emerge on Monday, and it is clear that the US president-elect is proposing a relatively small "stimulus" package, which will include further massive tax incentives for corporate America. The provisions for ordinary people will do next to nothing to alleviate the impact of the greatest economic crisis since the Great Depression.

This weekend the Obama transition team revealed that 40 percent of the estimated $675-775 billion it plans to spend over the next two years on its economic package would be earmarked for tax cuts, with about half going to big business.

The Wall Street Journal noted that the "Obama tax-cut proposals, if enacted, could pack more punch in two years than either of George W. Bush's tax cuts did in their first two years." Many of Obama's proposals, the newspaper wrote, were, in fact, extensions of measures carried out by the Republican administration over the last eight years. . .

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