Sunday, February 15, 2009


Bend as Ponzi scheme

Not the best headline, I'm afraid. But Bend is teetering on the edge of economic collapse; from a city with notoriously over-priced houses, it is now a city with a notorious inventory of unsold properties. Of course, the big developers, the bankers, lenders, realtors, the newspaper, chamber of commerce folks—all the folks that brought you the wonderful housing boom and ever inflating home prices are all amazed. They had no idea it would ever end, let alone collapse. Uh-huh.

You cannot build a city on nothing. There has to be a solid, continuing revenue source or sources for a city to grow. The west is littered with ghost towns. Someone finds a rich streak of gold or silver or copper, and a town is laid out. People pour in, buildings go up, property values escalate, the hype is that the city is the coming metropolis. But then the gold or copper runs out. There's no financial base. Virginia City, Butte, Goldroad, Austin, Columbia, Bodie, Goldfield—those towns, if they still have inhabitants, are just museum sets, no matter how big they got during the boom. Why did they empty? There wasn't enough money to keep the town going. It takes agriculture or diverse industry, something along those lines, to keep a solid financial base for people to tap into. Bend doesn't have that. All Bend has is hype—publicity as the greatest destination in the west. The city has tried to fund itself on future growth; it's like doubling down on losing bets or something like that. Sad, yeah. Going to be a lot sadder as the property values continue to deflate.

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