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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: John Vosilla who wrote (31634)5/20/2005 12:04:04 PM
From: GraceZRead Replies (1) of 306849
 
We're floating on a sea of money with no where to go for a decent return except speculation.

We had five years of contracting C&I lending while businesses paid down and wrote off capital equipment that retired worthless. Who wants to borrow in an environment where they need to consolidate? I wrote off a lot of the equipment I bought back during the boom, most of it had a positive return when all was said and done but due to serious technological changes in my industry it's worthless capital equipment now.

The equipment that I replaced it with is cheaper by several magnitudes therefore I was able to finance it with current cashflow. A $15,000 photo machine is easily replaced with a $1500 computer and no plumbing! I can borrow more now than ever before but I don't need to borrow anything. The changes in my biz destroyed several well paid professions between me and the final product and replaced those people with small footprint, cheap computers and software. The 3000 sq ft facility with 150k worth of equipment and four to five techs is replaced with half a dozen workstations and one worker, me.

Instead of sinking money in my biz every year I sink it into some new addition or improvement on my house (about the only RE investment I feel like making) or throw it into low return cash savings or bonds waiting for the equities market to stop crushing investors.

This year it's a pool house.
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