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  • Archive for October, 2011

    Herman Cain: Have We Seen This Movie?

    Posted by Lexington Green on 26th October 2011 (All posts by )

    Herman Cain raises some echoes of things we’ve seen before.

    He reminds me of Ross Perot. The same outsider stance. The same businessman, anti-Washington background. His 999 plan reminds me of something that Perot might have come up with. But unlike Mr. Perot, Mr. Cain has charm, he has a sense of humor, he seems to have political rationality, and he seems not to be a megalomaniac. Perhaps most importantly, he is running as a Republican, which means he has a meaningful chance to actually win.

    He reminds me of Reagan. A crowd-pleasing speaker who can get the base of the party on its feet and clapping. Again, a sense of humor, and a lack of apparent egotism. He is like the Reagan of the mid-60s, a person who is leaving a successful career in another field to get into politics, though of course he is doing so much later in life. Also, like Reagan, he does not sweat the small stuff, which will drive wonks of all stripes, and the MSM, into hysteria.

    He reminds me of Clarence Thomas. He does not remind me of our two prior serious Black candidates for president, Mr. Obama and Rev. Jackson. He carries his African American heritage with dignity, and he is forthright about the hardships he and his family suffered. But he does not talk in terms of grievance or injustice, but of pride, progress and opportunity.

    He reminds me of Wendell Willkie, a candidate from outside the mainstream of the GOP, with a business background, who surprised the Party machine and captured the nomination as the champion to drive the liberal-progressive monster from the White House. If the Germans had not overrun Western Europe in 1940, turning the election into a foreign policy election, Willkie would have had a good chance to beat FDR. The odds of 2012 being a foreign policy election are poor, unless Mr. Obama initiates open warfare with Iran.

    Still, when you add it all up, the answer is no, this really is a brand new movie. We have not seen this movie yet.

    Herman Cain is mostly different from all the earlier movies.

    The ad with the guy smoking is a curve ball. Who does it appeal to? What does it mean? (Stop it at 40 seconds: Is that a joint?) What are we to make of this? It is funny, though.

    We will likely see more surprises.

    So, while my guess is that Mitt Romney will carry all before him, I would not bet on it, not yet.

    Posted in Elections, Politics, Video | 21 Comments »

    Not the Geico Gecko

    Posted by Sgt. Mom on 26th October 2011 (All posts by )

    … and not too bad a picture for being taken with a cell-phone, either. We have these little critters all over the garden. My daughter surprised this one as she was hanging out the Halloween adornments.

    Posted in Diversions, Environment, Photos, Tech | 5 Comments »

    Romney

    Posted by Michael Kennedy on 25th October 2011 (All posts by )

    I was quite concerned today to see this story on Powerline. The country is in serious straits because we have spent and are spending too much on public employees. My first wife went back to teaching a few years ago when she got laid off in a bank merger. She had a lifetime certificate in elementary education and has worked as a mortgage banker after our divorce in 1978. After that, she worked for the FSLIC, closing and liquidating insolvent S&Ls and currently. at the age of 72, she works for the FDIC doing the same thing. Her brief experience as a third grade teacher about 20 years ago, appalled her. She was always a public school advocate. After the divorce, the kids all went to private school. Now she says she would home school them.

    Herman Cain won my support when he was asked what role the teacher’s unions played in out current school mess. He said that, as far as he was concerned, teachers’ unions were responsible for the school troubles. Would Romney say that ? He would be dreaming if he concluded that going easy on teacher’s unions would earn him any votes. Ditto for public employee unions.

    Why then would he disclaim supports for a budget bill that affects public employee unions?

    Why is he such a squish ?

    Posted in Elections, Politics | 24 Comments »

    Posted by Jonathan on 25th October 2011 (All posts by )


    Chicagoboyz keep abreast of latest developments in green transportation technologies.

    Posted in Photos | 1 Comment »

    Paging Dr. Kennedy…Paging Dr. Michael Kennedy

    Posted by Dan from Madison on 24th October 2011 (All posts by )

    Dr. Kennedy:
    I have broken the middle toe on my left foot. My question is do I tape it to the second or fourth toe, or don’t tape it at all? So far my treatment has been three ibuprofen and one glass of pinot noir. Thanks in advance, Dan.
    UPDATE: Broken Toe photo below the fold.
    Read the rest of this entry »

    Posted in Health Care | 13 Comments »

    “The Closing of the Muslim Mind and the Prospects for the Arab Spring”

    Posted by Lexington Green on 24th October 2011 (All posts by )

    Dear ChicagoBoyz readers: Please note this most excellent presentation, to be presented by the Mens’ Leadership Forum of Chicago.

    Our first, distinguished, speaker for the season will be Mr. Robert C. Reilly.

    (Stand by for announcements of future speakers.)

    The presentation will be on November 11, 2011 at 7:30am at the University Club of Chicago. You can register here.

    Mr. Reilly is the author of The Closing of the Muslim Mind: How Intellectual Suicide Created the Modern Islamist Crisis. See also his recent piece Will the Arab Spring turn into winter?.

    I will be at this event and I hope some of our readers will be there as well.

    Posted in Academia, Announcements, Arts & Letters, Book Notes, Chicagoania, Islam, National Security, USA | 4 Comments »

    So – Whither Occupy What Street?

    Posted by Sgt. Mom on 24th October 2011 (All posts by )

    As a terribly scarred and battle-hardened first gen Tea Partier, I have been following the fortunes of the OWS with mixed emotions; those emotions mostly being a combination of disbelief and horror. Your leaderless insurgency just sort of decided to get together, camp out in a public place and make enough of a spectacle for the media and general public to take notice? Read the rest of this entry »

    Posted in Americas, Human Behavior, Media, Politics, Tea Party | 6 Comments »

    Box Heads at Millennium Park

    Posted by Carl from Chicago on 23rd October 2011 (All posts by )

    Not sure what motivated them to dress up in box heads (I like the “pet” box that one brings on a leash) but they were happy to get their pictures taken at Millennium Park.

    Cross posted at LITGM

    Posted in Chicagoania, Humor, Photos | 3 Comments »

    Freddy King – Tore Down

    Posted by Dan from Madison on 23rd October 2011 (All posts by )

    http://youtu.be/RHKcbyJntyM

    There is just so much right about this video.

    Posted in Music, Video | 3 Comments »

    Ed Thompson

    Posted by Dan from Madison on 22nd October 2011 (All posts by )

    I just learned that Ed Thompson finally lost his long battle with cancer. Ed is Tommy Thompson’s brother.

    Ed was one of those characters that you only meet every once in a while. I remember the campaign for governor here in Wisconsin in 2002. It was my first serious foray into politics. I attended meetings that Ed had and eventually decided he was the guy for me. I donated to his campaign and worked on it as well. Ed was a Libertarian through and through. It was amazing to talk to the guy.

    He got an astounding 11% of the vote in that election. We were all very proud of what we had done. At the meetings there was every political stripe represented. There were people who just wanted more lax drug laws. There were businessmen. Women. All colors. Everyone believed in Ed and knew we were all tired of the same ‘ol two party system.

    Thank you Ed. You taught me more than you will ever know. RIP.

    Posted in Libertarianism, Obits, Politics | Comments Off on Ed Thompson

    Anecdotal Observance About The Economy

    Posted by Dan from Madison on 22nd October 2011 (All posts by )

    My wife and I live pretty busy lives, with kids, work, a hobby farm, and other diversions to keep us moving. Last night we had the rare date alone. We are building a house on the farm (more on this at a later date) and needed some time alone to talk about a lot of things.

    It was her choice to pick the eats, so she picked this place. It was absolutely jammed and the staff said it was a 1.5 – 2 hour wait for dinner. You literally couldn’t find a place at the bar for a drink.

    I laughed (I assume impolitely) at the staff when they said the wait was so long and we left for another place. The next stop was one of our old reliable eateries, Jac’s on Monroe Street. We were once again greeted with a packed house. The person seating customers had her best frowny face on and told us it was going to be at least a half hour.

    Exasperated and “hungry enough to eat the butt out of a skunk” as my grandfather used to say, we then had a short debate over Indian food or steak. The wife chose steak, so we ended up at Fleming’s. Even this high end steakhouse was almost full. We had a short wait (we got a spot at the nice bar there) and then got seated.

    All of these places are not cheap. Of the three, Jac’s is the most affordable, but you still won’t get out of there under $75 for a couple if you are drinking.

    My wife was the one who said that from this experience she isn’t buying the talk about a bad economy. And that might be true, at least for Madison. It isn’t even a football weekend.

    My thought was that perhaps instead of a larger vacation or other big purchase, people may be doing more “staycations” or going out to eat locally instead of the usual travel destination or vegas weekend. Hard to say.

    Posted in Economics & Finance, Personal Narrative | 18 Comments »

    College Edjumication

    Posted by Sgt. Mom on 21st October 2011 (All posts by )

    Well, following upon da Blogfadda’s tireless coverage of the various implications of the currently about-to-implode higher education bubble, I suppose that I might weigh in on the various merits/demerits of the so-called bubble, and the efficacy of even bothering to attend an institution of so-called higher education, with respect to my current career as a producer of readable genre fiction – which is not as highly-paid as the casual reader is likely to expect, but still  . . .  that career is underwritten by a pension earned for military service. It’s not the generous pension that I might have earned as a public servant in California as a prison guard or lifeguard, or municipal employee in certain urban sinks  . . .  but it suffices to pay the mortgage and a little over, since I had the good sense to retire and buy a residence in Texas, fifteen years ago. So, anyway – college education, value of, personal development  . . .  et cetera, et cetera, et cetera. Read the rest of this entry »

    Posted in Academia, Arts & Letters, Education | 12 Comments »

    Movement In Two Parts

    Posted by Jonathan on 21st October 2011 (All posts by )

    Watching a neighbor walk her dog. The dog squats. Neighbor picks up the pile. While the neighbor is bagging it, dog squats again a few feet away. This time neighbor ignores it.

    Questions:

    1) Maybe neighbor is out of bags?

    2) Is neighbor merely going through the motions — i.e., by picking up first pile she satisfies her public obligation and thus may ignore the second pile?

    3) Neighbor is doing the best she can in an admirable attempt at turd triage?

    4) All of the above?

    Zen bonus question: If a dog shits in the grass and no one steps in it, did it really happen?

    Posted in Diversions | 14 Comments »

    Gaddafi Dead

    Posted by Carl from Chicago on 20th October 2011 (All posts by )

    Gaddafi is dead. That news is everywhere.

    Ever since the uprising started I have been following it avidly not only because it involves a horrid dictator being taken down by his own people under NATO air cover but also because of past military historical knowledge of the region from following the Eighth Army vs. the Afrika Korps from the time I was a little kid. Most of that war was fought on Libyan soil (some in Egypt, and the end came in Tunisia).

    There is footage of Gaddafi being captured alive. The scene is chaotic but Gaddafi is clearly alive. It is unknown how Gaddafi thought this was going to end, but he seems surprised. For a man who attempted to radiate manliness and strength you’d have thought he’d have died under his own hand rather than being captured alive.

    He was holed up in Sirte for weeks, holding off the forces of the NTC, which mainly consisted of militias from Misrata and Benghazi. After fruitless attempts at negotiations, the militias moved up and back over a period of weeks, gaining ground over time but facing fanatical resistance. It is unknown what those resisting so fiercely thought they’d accomplish; there was nowhere to go, and nothing to do but surrender or die. It is ironic that Gaddafi’s forces fought so hard with little thought of their own survival while Gaddafi himself hid in a stinking drain pipe and awaited capture. I am only speculating but his hold on his bodyguards and remaining fighters must have been due to delusions of retaking the country or from fear of offending their leader, whom had run the country with an iron fist for over 40 years. Perhaps this is similar to German delusions of using “wonder weapons” like V2’s to turn the tide against the advancing allies in 1944-5 which helped to buoy morale when the end game was clear. Or perhaps it was a fear of violent reprisals at the hands of the Misrata militias, who had seen their city destroyed by pro-Gaddafi forces and suffered brutal atrocities. Only speculating but likely the latter.

    Rommel was famously quoted saying something along the lines of

    He who fights without command of the air fights like a savage

    Per the BBC Gaddafi’s bodyguards attempted to break out this morning and their convoy of armed jeeps was struck by either a jet or predator drone and suffered severe damage. Just as NATO played a critical role in turning the tide as Gaddafi’s forces neared Benghazi, they apparently played a pivotal role in shooting up this convoy and allowing NTC forces to close in while Gaddafi hid.

    There is a lot of discussion in certain parts of the media about darker skinned Libyans being targeted as mercenaries and allies of the regime; it likely won’t be helped that per the BBC in the end his remaining bodyguards (whose mauled and decapitated bodies were found near Gaddafi) were all black.

    Exactly how he died is under dispute and perhaps we will never know. All that is documented is that he was captured alive and in a crowd of NTC fighters and wound up dead. Given the violence that he unleashed and the nature of the militias fighting him (not professional soldiers) it seems inevitable that it would end up this way. This wasn’t a “formal” war; it was a civil war, brother against brother, and unlike the US civil war those types of conflict often end up with bloody frontier style justice. So it happened here, as well.

    Posted in Middle East | 10 Comments »

    I’m 100% Pro Life. End of Story.

    Posted by Dan from Madison on 20th October 2011 (All posts by )

    That is a post from Herman Cain’s Facebook page. Hard to say how involved Herman is in this medium, I would assume just a little.

    But I like this post. I really love it when people don’t waste time and just say exactly where they stand. Why beat around the bush?

    I have a friend who is a zany believer in the well disproven vaccines = autism deal. She plainly says that there is absolutely nothing that I can say or show her that will change her mind on the issue. I respect that much more than someone who wastes my time trying to show them how stupid their stance is, but are in the end someone who’s mind could never be changed in the first place, with regard to the subject of vaccines = autism.

    To me, there really isn’t a vast “presidential matrix” of issues that most people vote on. It is nice every once in a while to see exactly where someone comes down on an issue.

    Clearly, Cain doesn’t care about the pro-abortion vote (some may call this pro-choice).

    As a side note – to me, this issue isn’t a make or break, I am much more of a guns and money guy.

    At this point, I am a Cain guy, although this fight will be decided well before our primary here in Wisco. And that is why I am not paying too much attention to it.

    Posted in Politics, RKBA | 5 Comments »

    Saving Greece Without Germans

    Posted by TM Lutas on 20th October 2011 (All posts by )

    The Greeks do not need Germany to come bail them out. Russia was in something of a similar situation in the mid-1800s and resolved their financial and strategic difficulties by selling Alaska to the United States. At the time Russia feared that they had to sell Alaska or lose it to British Colombian expansion.

    There are over 6,000 islands in Greece of which only 227 are inhabited. These 5500+ are all assets that could be used to satisfy Greece’s debts either by concession, Hong Kong style, or outright sale as Russia’s Alaska holdings were sold. At the very least this is an option that should be talked about. Strategically, a sale could be offered to France, Italy, or the UK (I do not believe the US would be interested) that would create interesting possibilities of introducing a buffer state between the remaining Greek Aegean territory and Turkey. The islands themselves may or may not be worth much but their economic zones, fisheries, and resource possibilities are intriguing.

    The idea ultimately may turn out to be insufficient by itself to save Greece. But you really don’t know until you present the idea and so far nobody seems to be pursuing it. I find it odd that a proven method for raising money that does not require default or endanger the EU is not even on the table for consideration.

    Posted in Europe, Public Finance | 20 Comments »

    Government Overreach and Ethnic Conflict

    Posted by David Foster on 20th October 2011 (All posts by )

    The Austrian state suffered from its strength: it had never had its range of activity cut down during a successful period of laissez-faire, and therefore the openings for a national conflict were far greater. There were no private schools or hospitals, no independent universities; and the state, in its infinite paternalism, performed a variety of services from veterinary surgery to the inspecting of buildings. The appointment of every school teacher, of every railway porter, of every hospital doctor, of every tax-collector, was a signal for national struggle. Besides, private industry looked to the state for aid from tariffs and subsidies; these, in every country, produce ‘log-rolling,’ and nationalism offered an added lever with which to shift the logs. German industries demanded state aid to preserve their privileged position; Czech industries demanded state aid to redress the inequalities of the past. The first generation of national rivals had been the products of universities and fought for appointment at the highest professional level: their disputes concerned only a few hundred state jobs. The generation which followed them was the result of universal elementary education and fought for the trivial state employment which existed in every village; hence the more popular national conflicts at the turn of the century.

    –AJP Taylor quoted in Wilson’s War, by Jim Powell. Original source: Taylor’s book The Habsburg Monarchy

    (I think it’s fair to say that the term “national,” as used here by Taylor, basically means what we would call “ethnic,” since all of these various nationalities were subjects of the same empire.)

    Posted in Book Notes, Civil Society, Europe, History, Politics | 3 Comments »

    Comment Spam

    Posted by Jonathan on 20th October 2011 (All posts by )

    Admin note: Instead of checking every once in a while for legitimate comments that have been misclassified as spam, I am now deleting the contents of the spam filter daily without looking at any of it. So if your comment doesn’t post and you want me to retrieve it you should email me ASAP. Thanks.

    Posted in Announcements | 1 Comment »

    Encountering the Cat for the First Time

    Posted by David Foster on 19th October 2011 (All posts by )

    A Chicago Boyz discussion about cats reminded me of a passage in Robert Carse’s book The River Men…I was going to post it but didn’t have the book available. Now I do, so here it is belatedly.

    Brother Gabriel Sagard was a French missionary working in what is now Canada. In the winter of 1624, he stayed with the Huron Indians, and in appreciation of their hospitality he invited them to a feast at the nearest convent. For each of his Huron friends he selected an appropriate gift–for one of them, the captain of the canoe which had brought him from the village to the convent, he chose a large house cat. These Hurons had no prior experience with cats.

    This good Captain thought the cat had a rational mind, seeing that when he was called, he would come and play with one, and so he conjectured that the cat understood French perfectly. After admiring this animal, he asked us to tell the cat that he should let himself be carried home to his country, and that he would love the cat like his own son. “Oh, Gabriel!” he cried, he will have plenty to live on at home! You say that he is very fond of mice, and we have any amount of them. So let him come freely to us!” So saying, he tried to embrace the cat; but that wicked creature, who did not understand his way of caressing, immediately thrust out all his claws and made him let go quicker than he had clasped him.

    “Ho, ho, ho!” said the good man. “So that’s the way he treats me! Ongaron ortischat! He’s ugly, he’s bad! Speak to him!” Finally, having got the cat with a great deal of trouble into a birchbox box, he carried the him off in his arms to the canoe, and fed him through a little hole with bread that he had received at our convent.

    But when he tried to give the cat some sagamite, to his despair the cat escaped and flew up on a tree and they could not get him down again. And as far as calling him down, nobody home (personne a la mason); he didn’t understand any Huron, and they didn’t know how to call a cat in French, and so they were forced to turn their backs on them and leave him in the tree, very unhappy at losing him, and the cat very worried about who was going to feed him in the future.

    Posted in History, Humor, North America | 6 Comments »

    The Obama economy really is the pits

    Posted by onparkstreet on 18th October 2011 (All posts by )

    I’ve been in a mild funk lately because of all of the changes to one of my favorite little corners of Chicago Land. Closed and vacant shops mixed in with lightly populated high-end condo buildings turned rental. Halted construction and empty lots from development projects that fell through after the 2008 “crash”. Noisy restaurants where once stood second hand mom-and-pop shops, stationers and book stores. Closed, closed and closed. And yet, the local government persists in its grand 20-year economic development plans (I am not making that up) so that citizens are paying good money to brick streets, put up complicated and fashionable street lights, or have closed door meetings between developers and governmental officials. Welcome to Chicago and its suburbs. Lots of this-FEST and that-FEST sponsored by local officials in order to bring in business traffic, although many residents are inconvenienced by the crowds, noise and garbage. Some months ago while walking through the hospital, I overheard a conversation about this very neighborhood. It wasn’t very reassuring. I heard the words “scary” and “changes”. Urban blight. The beginnings of urban blight. People are so in denial.

    Posted in Big Government, Business, Chicagoania, Economics & Finance, Human Behavior, Miscellaneous, Obama, Personal Narrative | 10 Comments »

    Angie Pontani, The Brooklyn Slide

    Posted by Lexington Green on 18th October 2011 (All posts by )

    Please note the video below, which provides important information for ChicagoBoyz readers. It contains go-go dance instruction from Angie Pontani, of the World Famous Pontani Sisters, previously mentioned here and here.

    The Pontani Sisters are now touring with Los Straitjackets, including three Chicago area shows this weekend. I hope to be at one of these shows. The video shows you how to do their new dance number, the Brooklyn Slide.

    Please practice at home and attain basic proficiency before trying these steps in public.

    Posted in Arts & Letters, Chicagoania, Music, USA, Video | 7 Comments »

    Myth of the Great Railroad Land Give Away

    Posted by Shannon Love on 17th October 2011 (All posts by )

    In an otherwise excellent article, John Stossel repeats a historical fallacy that is one of my pet peeves. He says:

    The railroad didn’t make economic sense at the time, so the government subsidized construction and gave the companies huge quantities of the best land on the continent. [emp added]

    This is one of those assertions that gets repeated endlessly until it becomes widely viewed as unquestionable fact. Indeed, it does seem self-evident because one need only look at a map of the 19th century land grants to see that the grants covered vast stretches of land that today are some of the most productive and valuable agricultural lands in the world.

    There is just one problem. Most of that land today, and even more so in the late 19th century, is valuable for only one reason:

    It has a railroad running though it.

    Read the rest of this entry »

    Posted in Economics & Finance, History | 25 Comments »

    The Blamer versus the Problem-Solver

    Posted by David Foster on 17th October 2011 (All posts by )

    The poisonous nature of so much of today’s political discourse is in large part due to the climate of blame-casting encouraged by Barack Obama. Given any difficult situation whatsoever, it is clear that Obama’s primary instinct is to use it as an opportunity to demonize a selected group. The man has remarkably little interest in problem-solving. Despite his faux reputation as an intellectual, there is nothing of the scholar or analyst in him. It’s all about speech-making…”the use of his vocal chords is to him inseparable from thinking, as Freud and Bullitt wrote about Woodrow Wilson…and the speeches, especially these days, are usually mainly about an attack on a targeted group.

    A strong contrast is offered by presidential candidate Herman Cain..a man who has lived in an environment of problem-solving….ballistics problems for the US Navy, programming problems while getting his CS degree, marketing and production and management problems at the pizza company. You can’t solve trajectories or write code or make and sell pizzas by seeking out someone to blame.

    This is a contrast that it would be wise for the Cain campaign to emphasize strongly.

    Posted in Politics, USA | 9 Comments »

    An Historical Diversion

    Posted by Sgt. Mom on 16th October 2011 (All posts by )

    I mean to write something cogent about current events, but I’ve just written two blog pieces for pay, and a book review and just ran out of time this evening. So, what about some pictures?

    This year was the 175th anniversary of the Texas Revolution – and because the events of that war and the aftermath features highly in my books, I went to two re-enacted events: one at the Alamo, the other at the Goliad. Couldn’t make it to the San Jacinto re-enactment, it would have been a four-hour drive.

    Anyway – enjoy. Read the rest of this entry »

    Posted in Civil Society, History, North America, Politics, Tea Party, War and Peace | 11 Comments »

    The Next Bubble

    Posted by Carl from Chicago on 16th October 2011 (All posts by )

    I know a lot of people who rent and recently overheard how difficult it is to find an apartment. This is anecdotal but they said that you needed to sign a multi-year lease and / or offer MORE than the requested rent to guarantee that you get one as soon as it is open.

    The New York Times today had an article titled “The Lease is up, and now so is the Rent” describing the situation in New York City:

    Across New York, rents have not only rebounded from the depths of two years ago, but are also surpassing the record high of 2007 during the real estate boom, according to figures from Citi Habitats, a large rental brokerage, and other surveys. That means a perennially frustrating process has become almost frenzied. Brokers say prospective renters need to come prepared to close a deal on the same day — ready to write a check for thousands of dollars to cover the first and last month’s rent, and the broker’s fee. For desirable apartments, forget about open houses — the best places are snapped up within a few days, or less, through private showings by brokers.

    In the comments section on that post they mention what the article (typically) fails to do; New York’s problems are exacerbated by their ludicrous rent-control laws, which distorts developers’ behavior and forces some renters to subsidize their neighbors and creates a “shadow economy” of sublets.

    In Chicago it is (comparatively) easy to build new rental stock to take advantage of the situation; in my River North area there are giant new rental only buildings going up everywhere. At this site where a bank used to be there is another hole for a 20+ story apartment building at 501 N Clark.

    I remember back in an economics class in college a professor discussed the real estate boom in Arizona in the ’80s… he said that since the builders were all small, they didn’t know when to exit the market. Individually they weren’t large enough to have market intelligence (such as in an industry with a few large players, like chemicals) so they just kept overbuilding and doubling-down their chips until they were wiped out. Only a few were smart enough to take their cards off the table rather than try to chase the last win, only to fall short and get caught when the market tanked.

    It will be interesting to see who will take the brunt of the collapse in the higher-end rental market that is likely to occur in a few years. Someone is financing these rental projects; while they are not as subject to failing as a similar condo project (since sales are binary while you can adjust rents in a falling economy) they are still risky and require lots of up front debt financing as well as being hostage to rising real estate taxes (especially in Chicago, where we are in dire financial straits). A lot of the banks that funded the condo buildings went under and were taken down by the FDIC; perhaps the banks that are financing these new buildings will take the brunt, too.

    As these buildings get constructed downtown, expect the more marginal rental units in the outskirts to take a big hit later when the number of renters falters. I anticipate that the big buildings would cut rents rather than remain empty (since it is essentially a fixed-cost operation, like an airplane, so getting any tenant is better than letting it sit vacant), and then they would prove to be tough competition for the less-modern rental buildings. Watch and see it all unfold.

    Cross posted at LITGM

    Posted in Business, Chicagoania, Real Estate | 12 Comments »