March 3, 2010

So How’s the Economy Doing?

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Email from a friend involved in the legal end of the commercial real estate market:

We just had yet another lender pull the plug on a commercial real estate deal that was set to go.  The stated reason was minor and technical.  The real reason we’re guessing is that it has too many underwater loans on its books and simply doesn’t have the resources.

So what is happening now?  Remember the doom and gloom scenario of mass foreclosures by banks to get the bad commercial real estate loans off their books?  Well, if my purely anecdotal experience with the first few months of 2010 are any indication, that scenario will not be happening any time soon — which is a bad thing.  It will not be a dramatic cascade but a slow tentative process with limited positive impact on the economy.

Instead, it appears that banks are continuing to grant very long deferments rather than take the loans down.  The logic here is bizarre, but understandable I guess.  They are punting on the issue until the economy improves, which they are betting is next year or so.  But if they don’t get the bad loans off their books, they can’t free up their resources to provide the necessary new financing to recharge the economy.  Then next year they’ll punt again.  And the vicious circle continues. I’m not sure what the government can do here, but I sure hope there is some creative thinking going on in D.C.

It’s just a single data point, but I’ll bet there’s a lot of similar stories out there. We may have saved the banking system last year, but it’s still in pretty fragile shape.

WE CAME UP SHORT.

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That means we're going to have upwards of $350,000, maybe more, to raise in online donations between now and June 30, when our fiscal year ends and we have to get to break-even. And even though there's zero cushion to miss the mark, we won't be all that in your face about our fundraising again until June.

So we urgently need this specific ask, what you're reading right now, to start bringing in more donations than it ever has. The reality, for these next few months and next few years, is that we have to start finding ways to grow our online supporter base in a big way—and we're optimistic we can keep making real headway by being real with you about this.

Because the bottom line: Corporations and powerful people with deep pockets will never sustain the type of journalism Mother Jones exists to do. The only investors who won’t let independent, investigative journalism down are the people who actually care about its future—you.

And we hope you might consider pitching in before moving on to whatever it is you're about to do next. We really need to see if we'll be able to raise more with this real estate on a daily basis than we have been, so we're hoping to see a promising start.

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WE CAME UP SHORT.

We just wrapped up a shorter-than-normal, urgent-as-ever fundraising drive and we came up about $45,000 short of our $300,000 goal.

That means we're going to have upwards of $350,000, maybe more, to raise in online donations between now and June 30, when our fiscal year ends and we have to get to break-even. And even though there's zero cushion to miss the mark, we won't be all that in your face about our fundraising again until June.

So we urgently need this specific ask, what you're reading right now, to start bringing in more donations than it ever has. The reality, for these next few months and next few years, is that we have to start finding ways to grow our online supporter base in a big way—and we're optimistic we can keep making real headway by being real with you about this.

Because the bottom line: Corporations and powerful people with deep pockets will never sustain the type of journalism Mother Jones exists to do. The only investors who won’t let independent, investigative journalism down are the people who actually care about its future—you.

And we hope you might consider pitching in before moving on to whatever it is you're about to do next. We really need to see if we'll be able to raise more with this real estate on a daily basis than we have been, so we're hoping to see a promising start.

payment methods

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