Real Estate

90 Layoffs at Moonlight, as Resort’s Cash Troubles Continue

A mass layoff at Moonlight Basin near Big Sky, Montana, has sent a chill through Gallatin Canyon's resort community.

Sources said about 90 employees lost jobs. CEO Lee Poole declined in a written statement to address specifics of the layoffs or how many workers remain.

"Moonlight Basin Ranch and a number of its subsidiary companies have decided to immediately implement temporary layoffs of a portion of its workforce," Poole said in a press release issued late Wednesday afternoon. "We are deeply saddened by this painful but necessary action."

Revisiting an August Speech on Banks: Failure Teaches the Right Lessons

Tomorrow in Chicago, Minneapolis Federal Reserve Bank president Gary Stern will give an updated version of his speech called "Repercussions from the Financial Shock" in which he argued that banks should be allowed to fail, so managers will learn the harsh lessons only failure can teach.

The text of the new speech at the Council of Institutional Investors won't be made available. Perhaps the subject matter is too close to a critique of the daily money matters rocking the financial world and the world economy. Not that anything should be read into his decision. Stern is a private Fed president. He speaks less than most others, said Minneapolis Fed spokeswoman Patti Lorenzen, and it's fairly standard for him to keep the text of his speeches to himself.

The upshot is that unless you're planning to attend the meeting in Chicago tomorrow, you'll miss the words of this influential and smart guy. That's why I thought it would be a good idea to point you to this story I wrote about Stern's earlier version of this same speech, given in Three Forks in mid-August.

In light of recent events, I might re-write the headline as follows: Fed Reserve Branch Head Says Let Banks Fail.

More Editorial Cuts, and More and More

Will Newspapers Deliver News Anymore?

Newspapers cuts this week have begun to seriously call into question the continued ability of newspapers to deliver news.

Yesterday the independently owned Spokesman-Review announced plans to cut 27 more newsroom jobs, almost one-quarter of its editorial staff while newsprint prices continue to soar and profits, industry-wide, keep plummeting.

Earlier this week Lee Enterprises flagship paper, the St. Louis Post-Dispatch, cut 18 more jobs, including its primary cops reporter. Over the past few months, the newsroom has been practically gutted by Lee, which remains one of the few profitable newspaper companies.

Housing Down, Fuel and Food Prices Up

More Montanans Seek Bankruptcy Protection

Mortgage resets, the rising cost of food and fuel and the slowdown in the housing market have pushed personal bankruptcy filings to nearly double the numbers from two years ago, according to numbers from the U.S. Bankruptcy Court in Butte.

In the first nine months of 2008, there were 1,140 new Chapter 7 bankruptcy filings, up from 664 over the same period two years ago.

The most dramatic increase has been in the past few months, especially in September, said Lynn Myers, chief deputy clerk at the state's bankruptcy court.

"We had 25 cases open up in one day," Myers said. "We haven't seen something like that since October in 2005."

Stimson Moves Forward With Auction for Mill and Materials at Bonner

Stimson Lumber Co. will go forward with plans to auction off its sawmill and plywood-making equipment at the former lumber mill just east of Missoula in Bonner in about two weeks, said Stimson's Jeff Webber.

"It'll be at the mill site. What it'll be like is the auctioneer will come in and people will come over, and they'll start from one end and go to the other, marking it all out in separate bid lots," Webber said. The proceedings will be managed by Washington-based industrial auctioneer James G. Murphy Co. The two-day auction will start Oct. 14.

RESORT DEVELOPMENT

In Wall Street Crisis and Credit Crunch, Everlands Sees an Opening

Everlands, the new luxury destination resort formed in part by the Lone Mountain Ranch near Big Sky, Montana, had used all but $14 million of a $55 million line of credit from Lehman Brothers, when the Wall Street investment firm fell into bankruptcy, said CEO Ken May.

Instead of lamenting his lost credit line, which he used to buy the highest of high-end small inns and lodges around the world for Everlands' members, May says the situation looks just right.

Resort Development

Moonlight Struggles for Cash in Wake of Lehman Bankruptcy

Work has halted at the Moonlight Basin resort near Big Sky, Montana, after its construction funding vanished -- a casualty of the bankruptcy of the Wall Street investment firm Lehman Brothers.

"Lehman Brothers has been Moonlight Basin's banking partner for the last 13 months," wrote Moonlight CEO Lee Poole in an emailed statement in response to questions about the development. "We are… working through the matter and expect to continue normal operations."

Montana Banks Watch Wall Street, Feel the Tremors

As the fallout from the housing crash continues to reverberate on Wall Street, Montana banks have been re-appraising balance sheets, taking another hard look at collateral and reassuring Main Street businesses, which have begun to feel the economic slump.

"All the stuff that's happened… doesn’t affect but a handful of banks in the state, if any," said Michael Richards, president of Bank of Bozeman, who was referring to the collapse of the investment firm Lehman Brothers and the $85 billion bailout of the international insurance group and financial services company AIG.

The real estate collapse, basically, is what dragged down those two companies, as well as investment firm Merrill Lynch.

High Finance

Montana’s Lehman Brothers Connection: Richard Fuld

It's a long way from Wall Street to Whitefish, but for better or worse the connections these days are closer than you might think. This week's case in point: Richard Fuld, chairman and CEO of Lehman Brothers, the huge financial firm that went bankrupt this week, is a partner in two major Whitefish-area real estate projects.

While Fuld's Montana ventures, which are part of a partnership with super-star venture capitalist Mark Kvamme, are in better shape than his investment bank, they are not exactly thriving amid the real estate slump.

Take the Homestead at Whitefish, one of the region's seemingly countless "unique" developments, "nestled" into the mountains and offering buyers an "authentic Western lifestyle." With lots priced from $500,000 to $1.5 million and spec homes in the $4 million range, the Homestead is, uh, not selling very well.