Big news broke in the anxious commercial real estate market yesterday when the nation's second biggest mall chain, General Growth Properties Inc. -- holdings include such local retail monsters as Virginia's Tysons Corner and Baltimore's Gallery -- filed for Chapter 11 protection. It had amassed a mountain of debt, insanely leveraged, during the boom years, and saw much of that debt come due around the same time: right when the credit market collapsed.
Harumph! Shame on this company! A purveyor of everything bad everywhere, fueling the whims of America's retail-addicted Credit Card Economy and its inflated standards of living and junk!
Pundits like to moralize this way nowadays whenever any company that employs a lot of people goes bankrupt. Take New York Times columnist Thomas Friedman. Here is how he "summed it all up" in his most recent book from last fall, Hot, Flat, and Crowded.
In some ways, the subprime mortgage mess and housing crisis are metaphors for what has come over America in recent years: A certain connection between hard work, achievement, and accountability has been broken. We’ve become a subprime nation that thinks it can just borrow its way to prosperity...
Metaphors! Not, say, the very things that have come over America in recent years, but metaphors. "In some ways."
Shame on everyone for being terrible!
Shame on my wife!
Shame on-- OH GOD WHAT HAS MY WIFE DONE?
...[T]he author’s wife, Ann (née Bucksbaum), is an heir to the General Growth fortune. In the past year, the couple—who live in an 11,400-square-foot mansion in Bethesda, Maryland—have watched helplessly as General Growth stock has fallen 99 percent, from a high of $51 to a recent 35 cents a share. The assorted Bucksbaum family trusts, once worth a combined $3.6 billion, are now worth less than $25 million.
Whoops.
So as the commercial real estate market starts to deteriorate more rapidly -- and analysts expect many, many more General Growths headed our way this year -- don't hold your breath for Thomas Friedman to tackle (yell at) this particular "metaphor" of America as he did the residential real estate market and U.S. automobile industry "metaphors."
Jim Newell writes for Wonkette and IvyGate.
