Virginia's 5th District

President Obama says there is a health care crisis as well as a climate crisis and something needs to be done immediately. Even though the global temperatures have been cooling over the last decade and health care reform won’t take effect until 2013 we need to deal with this now. Yet Mr. Obama along with everyone else in Washington is ignoring another potential real estate crisis that will plunge our economy further into recession. This crisis I speak of and that no one else seems to want to talk about is the commercial real estate bubble that is getting ready to burst.

We all saw what happened to the economy with the residential market taking a tremendous hit, now with the continued unemployment the commercial market is ready to implode. This from an article on Bloomberg.com from March 23:

“The country’s 10 biggest banks have $327.6 billion in commercial mortgages, which face a wave of defaults as office vacancies grow and retailers and casinos go bankrupt. A projected tripling in the default rate would result in losses of about 7 percent of total unpaid balances, according to estimates from analysts at research firm Reis Inc.”…

“The number of retail properties seized by banks or in some state of default rose to 464 this month, more than triple the number on Dec. 18, with a total value of $7 billion, according to Jessica Ruderman, a research analyst at Real Capital Analytics Inc. in New York. That means banks aren’t being repaid and are stuck owning properties that have plunged in value.”

This was written when unemployment was at 8.1% now with unemployment pushing 10% by year end the New Year does not look very promising. So why is this situation being ignored? The congress and administration are worrying about climate change and a non-existent health care crisis, 85% of Americans have health insurance. If the economy deteriorates more in the coming months, which is very likely, the jobless rate will increase and so will the uninsured.

Here is this from a more recent article in the Sacramento Bee written in September:

“About $2 trillion worth of commercial mortgages worldwide are coming due in the next four years, Deutsche Bank says in a recent report. Because property values have slumped so much, hard-bitten bankers are telling borrowers to put up more cash if they want to roll over those maturing loans – a requirement that could push many property owners to the brink.”

If Obama wants to create jobs he should be reducing the tax burden on businesses and the people instead of finding new creative ways of wasting the publics hard earned money. But that doesn’t work for our socialistic president he would rather drive our country into bankruptcy so he can promote his welfare state.

I want to know where our two senators and congressmen are on this situation and what and if they plan on doing something about it. Or are they going to ignore it like the rest of the politicians and when the s**t hits the fan say they never saw it coming and then blame it on George W. Bush.