How the Financial Crisis May Not Be So Bad for New York
We just got around to reading the cover story of the current issue of The Atlantic Monthly called How the Crash Will Reshape America. One of the article’s central points is that while hubs of intellectual and creative capital like New York will surely suffer in the economic crisis, they will suffer a lot less…
We just got around to reading the cover story of the current issue of The Atlantic Monthly called How the Crash Will Reshape America. One of the article’s central points is that while hubs of intellectual and creative capital like New York will surely suffer in the economic crisis, they will suffer a lot less than second-tier cities, the suburbs or industrial areas and therefore benefit on a relative basis. While there has been much hand-wringing about New York’s reliance upon the finance industry, many other smaller cities, it turns out, are much more reliant: Hartford, Des Moines and Charlotte, to name a few. Rather, New York is an incredibly diverse place which should be well-positioned to reinvent itself faster and more efficiently than other places:
New York is much, much more than a financial center…It is home to a diverse and innovative economy built around a broad range of creative industries, from media to design to arts and entertainment. It is home to high-tech companies like Bloomberg, and boasts a thriving Google outpost in its Chelsea neighborhood… New York is more of a mecca for fashion designers, musicians, film directors, artists, and—yes—psychiatrists than for financial professionals…The financial crisis may ultimately help New York by reenergizing its creative economy…Place still matters in the modern economy—and the competitive advantage of the world’s most successful city-regions seems to be growing, not shrinking…Talent-rich ecosystems are not easy to replicate, and to realize their full economic value, talented and ambitious people increasingly need to live within them…Economic crises tend to reinforce and accelerate the underlying, long-term trends within an economy [like the map of per capita patent creation above]… In this case, the economy is shifting away from manufacturing and toward idea-driven creative industries—and that, too, favors America’s talent-rich, fast-metabolizing places.
Sounds good so far, right? Here’s how the trends will play out on the American landscape, according to the author Richard Florida:
What will this geography look like? It will likely be sparser in the Midwest and also, ultimately, in those parts of the Southeast that are dependent on manufacturing. Its suburbs will be thinner and its houses, perhaps, smaller. Some of its southwestern cities will grow less quickly. Its great mega-regions will rise farther upward and extend farther outward. It will feature a lower rate of homeownership, and a more mobile population of renters. In short, it will be a more concentrated geography, one that allows more people to mix more freely and interact more efficiently in a discrete number of dense, innovative mega-regions and creative cities. Serendipitously, it will be a landscape suited to a world in which petroleum is no longer cheap by any measure. But most of all, it will be a landscape that can accommodate and accelerate invention, innovation, and creation—the activities in which the U.S. still holds a big competitive advantage.
Sounds like we’re sitting pretty, huh?
How the Crash Will Reshape America [The Atlantic]
11217…we were watching GS all day today…it was very volatile…that number is probably doable…it will come out 4/16 and if it does, this stock is off to the moon. GS peak quarterly earnings were over $7.00. The ratinale is sound…the competition is gone, completely….Bear Stearns, UBS (for all intents and purposes), LEH, MER
I12 – good points, well taken.
However, I think the growth of the suburbs long pre-dates the 70s: it started in-earnest with the GI Bill which made suburban development & home-ownership so cheap, people were nuts not to dive right in…
Now that suburban life requires so much more of our land, fuel & time [all of which seem to be in dwindling supply], it has become a less-and-less attractive option.
And if you look back to the bad-old-days, don’t forget that NYC’s social problems started before its economic troubles: it was the white flight & deferred-maintenance of the 60’s that lead to the city’s problems in the 70’s.
What’s more, the national mood in the early 70’s was highly reactionary – just think of Nixon’s ‘Silent Majority’ & the Republican Party’s racist ‘Southern Strategy.’ In the popular imagination, NYC was a place filled with black junkies & pimps, Puerto Rican gangs, gays, Jews & ‘limousine liberals.’ That image made it quite comfortable for Ford to tell us to ‘drop dead!’
I don’t think I have to remind you that times have changed just a bit since then…
Still, the one thing that hasn’t changed in all that time is people’s desire to make money [aka, greed]. I don’t think that the investor class is by any means dead & that it’s only a matter of time before the money starts flowing.
This one’s for you, What:
BLOOMBERG
Goldman Has Returned to Profit, Bank of America Says
By Rita Nazareth
Feb. 19 (Bloomberg) — Goldman Sachs Group Inc., which reported its first quarterly loss since going public in 1999, has returned to profit after boosting fees it charges customers for trades, according to Bank of America Corp.
Goldman Sachs will probably report first-quarter earnings of $1.58 a share, Bank of America analyst Guy Moszkowski wrote in a report today after a meeting with Chief Executive Officer Lloyd Blankfein and Chief Financial Officer David Viniar. That would beat the $1.12 average analyst estimate in a Bloomberg survey.
“Customer-facilitation spreads are the widest Blankfein can recall, as competitors have disappeared or retrenched, and hedge funds de-leveraged,†Moszkowski wrote. “We are encouraged by the improved outlook and continued solid execution.â€
Goldman Sachs, which was the largest and most-profitable U.S. securities firm until last year, suffered its first quarterly loss as a public company during the three months that ended in November. The shares, which plunged 61 percent in 2008, have gained 3.2 percent so far this year.
Shares of Goldman Sachs gained 3 percent to $87.07 at 2:46 p.m. in New York. They advanced as much as 5.2 percent earlier, the most intraday since Feb. 5.
These comparisons of NYC with the crime ridden NYC of the 70s and 80s are just nuts.
You don’t know what buned feels like until you start with condos in foreign countries…beijing is a good start, l12
parkedslope: very good comments, but I think the differences can easily make New York fare WORSE than the rest of the country, not better. After all, in the 1970s it did. An economic depression means higher crime, cutbacks in public transport and other niceties that make urban life livable.
This is exactly what drives people out of the cities and into suburbs behind a gate.
We’ll see how long all the gentrifiers and investors want to stay and raise their kids in New York as crime spikes. Also, New York was subject to the same massive overdevelopment as everywhere else but possibly worse, due to the phenomenon of ‘hot neighborhoods’ where everyone decided that you could never build enough fancy new condos within 4 subways of McCarren Park because there would always be investors to put up with renting to partying hipsters for a few years as their investment in ‘the next soho’ grew.
The problem with this article is it’s simply not the creative class that creates wealth in a city except in the very long-term. It’s all the investors who are seeking to capitalize on that long-term. They will still be out there, it’s true.. If they aren’t too burned from the past. After all.. after the internet bubble, people didn’t stop investing in internet companies, but they sure didn’t do it as much and they lost 90% of their value.. once burned twice shy. Especially when you could be investing in Beijing apartments..
‘a title shot?’
try a tetanus shot…
I don’t know?? There is always some unknown Retard looking for a tittle shot with The What ! I always ask myself WHY?? Are these retards are looking to make a name for themselves or they cannot believe the Explosion of the Mutant Asset Bubble is breaking the back of the US financial system? Maybe they cannot believe that the US Banking system is INSOLVENT! Maybe they can’t believe the US Government has given billions of Tax slaves money to bail out Plutocrats. So I will just sit and laugh at the dummies because their energy is directed in the wrong way…
The What (King of Brownstoner! All Asshats come to my harbor!)
Someday this war is gonna end…
Nice one, What: too bad you didn’t read the next sentence:
“we are not immune: a sinking tide lowers all boats….”
At the risk of igniting another of your Kaczynski-like rages, I have to ask: why do you even bother?
What makes you so lonely & desperate for attention? Sure, living under the stairs in your mother’s decrepit house in Lodi isn’t the surest way to attract girls [and you may want to do something about the skinsuit and the army of pet rats]. But have you considered washing your hair, brushing your teeth & getting a little sunshine once-in-a-while? Or does mother punish little boys who go out in public? That’s assuming mother isn’t a mummified corpse who shares your bed…
Did you actually read this far? Wow, I’m impressed! Thanks for your valuable time!
I feel validated, thanks to the What!
“-New York is different than Orlando, Miami, Tampa, Las Vegas, Phoenix, Orange County, et al.”
I love when the retards disconnect their madness from everyone else. This Asshead believes that New York is a separate and will not be affected by the Exploding Mutant Asset Bubble! Because New York is _____________ Blah Blah Blah…. Dumbasses….
The What (Obama may I have one skittle, please)
Someday this war is gonna end…