Monday Business Roundup
Housing Bust Just Starting
By Richard Martin, 3-12-07
Think that the worst of the housing bust is over? Think again. Investment bank Credit Suisse released a report saying that losses from “subprime loans” (i.e., mortgages taken out by home buyers with less than stellar credit histories) could top $10 billion over the next couple of years. “The deepest housing decline in 16 years is about to get worse,” reports Bob Ivry of Bloomberg News.
The implosion of the subprime home-loan market struck home again last week as Glenn Puller and Cindy Ingram, convicted of mortgage fraud for a scheme in Aurora, were sentenced to federal prison last week. Post business columnist Al Lewis has a sharp analysis of how Puller, Ingram and their fellow defendants defrauded lenders including New Century Financial – an Irvine, Calif.-based company that has become a symbol of the bad-loan bust, as a page-one Wall Street Journal feature (sub. req.) details this morning.
Boulder real estate blogger Osman Parvez offers a detailed look at how the housing bust will affect Boulder County (scroll down). Short version: the news is not all bad.
In other business news: Qwest looks for ways round the legal ban on telcos offering pay TV statewide; local companies represent at the Natural Products Expo; and Vail Resorts sees real-estate revenue multiply more than five-fold.
In other business news:
-- Last month the state legislature tabled a bill that would give telecom companies like Qwest the opportunity to offer pay TV across the state (not just in cities where Qwest has a franchise already). The response of Chuck Ward, president of Qwest Colorado, quoted in today’s Rocky Mountain News: “The legislature found the status quo for Colorado is OK, which I continue to be amazed at. Seven percent price increases for cable service doesn’t seem to be a good status quo to me.”
-- The Natural Products Expo West, in Anaheim, Calif., wrapped up yesterday, and naturally (pardon the pun), Boulder-area companies were well-represented. The Daily Camera tracks the experience of a rookie entrepreneur at the Expo, Fiona Simon of Fiona’s Natural Foods.
-- Heavy snows plus a hot market for high-end resort real estate pushed Vail Resorts’ quarterly profit up 23 percent, the company said today. Mountain revenue – i.e., sales of ski passes and the like, grew healthily, by 10 percent to $272 million. Real estate revenue grew more than five-fold, to $56.2 million from $9.7 million.
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