San Diego Housing Bubble News and Analysis

I dropped by Fashion Valley Mall to see if the Presidents' Day sales were worthwhile. The store turnover is remarkable, I've not seen the like since I moved to San Diego in 2000. There seemed to be more staff than customers in many locations.

Great question LD. Here is a quick input in my industry, IT Outsourcing & more.

1) IBM had a message last week that will cut 15% off employees wages. I don't remember the specifics, but I know a few thousands IBM employees signed up a petition against this wage cut..... I doubt there is anything they could/can do.

2) My own organization,global IT outsourcer,(I won't name names) is doing poorly in San Diego.In fact is moving out of San Diego and a push out of California slowly (I won't give many details). Bottom line, our subcontractors will have all their wages cut by about the same %. Needless to say that my organization experienced a hiring freeze for many months already.
I shouldn't even mention that I'm in charge of outsourcing/offshoring labor globally for some division, and they're working to outsource the outsourcer.

3) Retail is doing poorly. Under my consulting business, I've set up a Supply Chain for a retail store in PB a few years ago.The news I get today are grimm. Lease on the store is in the thousands, and daily sales are bearly breacking a couple-few hundreds. I know the store manager is gone - already. The owner took that role now.

4) Another big retailer,Wilson, will close 1,000 stores across N. America. That's scary. I know another group of national retail stores are cutting full-time employees by 8 hrs/week.

5) Moreover, I'm looking for new work, and I've had 2 interviews. I tell you, the budgets for some of those positions are not that exiting. I've applied for many positions w/out getting much feedback, which reminds me of the DOT COM crash era. Back in 2001,it took me about 3.5 months to find my current job after applying for over 380 positions. I haven't applied for that many jobs right now, but all the prospects I've had are through friends/ex coworkers - which tells you something about the market.

I've got 10 years industry experience & an MBA. I've left manufacturing in 2000 and moved to the service industry. I've got a pretty broad SCM experience (semiconductor industry, IT, high-tech manufacturing) - and no particular feedback from employers(unless one has an insider contact).

Now on the positive side - the majority of jobs I find require military experience. I do not have any govt/military background or a security clearence.

SD: Sounds like you might work for CSC...

lindismith
I agree that the slowdown is starting to show. Out shopping last weekend and a store manager told us that their corporate office had significantly slowed any new shipments to their store as sales had been so bad for the past few months. So many industries will be hurt through this and we all will be affected somehow.

On a side note, what kind of sewing does your business do? Curious as I'm looking for bag manufacturers in the area....

SD-T: I hope your CV is written better than this post. There's supposed to be a space after periods and commas, and exiting and exciting are two different words, to name only two examples. Good luck in your search.

the economy is just humming along in the peninsula (norcal) - that's the good news. The bad news is price is still rising in some parts and holding in most other.
what's a renter to do?

We're in Vegas and it's definetly apparent in the real estate market here. However, rent rates are going up and discretionary consumption is up as well. Foreclosure inventories are still rising because there were soooo many bad loans made here, but investors that stuck around are able to rent properties out pretty easily.

You may find this interesting: You can buy a SFR (3b/2b) within 5 miles of the tourist corridor (The Strip) for just about $300K and rent it out for $1100-$1300 per month. You can buy the same size SFR 8 miles from The Strip for $170k - $220K, and it too will rent for between $1100-$1300 per month. Freaky, huh?

I finally broke down and went shopping this weekend. Went to the UTC mall to get some stuff since I had won a gift certificate from my company at the xmas party and hadnt spent it. I dont buy much, never did. What shocked me was how little other people seemed to be purchasing. There were alot of people there, but no one buying anything. While shopping I remembered other threads on here around xmas time talking about the mall traffic, and it made me start looking.
IF people were carying bags, it was 1, and it had one thing in it. I eventually got 2 pairs of pants and a new pair of running shoes. When I got in line behind 4 other people (1 clerk, struggling with a bad register, not too many people clogging things up) I noticed what they were getting. 1 shirt or maybe a pair of dress pants. I EASILY had the largest amount of merchandise, all $80 of it. I dont see how retailers can be doing well when 5 shoppers all together MAYBE spent $250. Oh, and when I picked up my bags and turned to go, no one was in line behind me.

I haven't noticed a slowdown in my industry (semiconductor telecomm) but there are always rumors and gossip about pending layoffs or hiring freezes.

Business as usual here in eastern LA county. Went shopping today for some President's Day sales, and the parking lots and stores were mobbed as always. I live right on the edge of LA/OC/SB county lines and whenever I go into OC, it never ceases to amaze me how crowded the restaurants are. Doesn't anyone in OC ever eat at home? Bottom line, no recession clouds forming here. And by the way, prices of homes around here have barely budged off their highs. I'm now in year three of renting, waiting patiently for the much publicized correction.

I think if you go shopping on the weekends it will seem just as packed as always. Might be a perception thing.

I prefer to do my shopping during the week when I telecommute (nice to get out of the house). Last Wed. Costco was practically empty, never in my life seen it that quiet. Maybe 1 out 3 registers was open with 1-2 folks in line. Most people were only buying essentials.

Nor-La-SD-Guy

As bad as the downturn in Temecula is said to be (and it is bad..), I went by Costco in Temecula Saturday(completely packed), went out to eat Saturday as well (an Italian Place in the Mall area forget the name starts with a G) , Completely packed as well had to wait about 20 Minutes.

Seems People have money to spend in Temecula.

A bunch of little Nero's fiddling as Rome burns, perhaps?

Or maybe we are all wrong and it really is a new paradigm!

Diego Mamani,

Good catches - thanks for pointing that out. I was in a rush, and I do not post messages that long w/out doing a pre-check in MS Word (there is a 1st time for everything). Aside from the grammatical errors and paragraph format, I hope the message still gets across.

Vis-à-vis the job hunt, I have not tried hard enough because I am not in a desperate position. That could change of course.

The substance of the message is that during low unemployment & a stable market, I was able to get job offers pretty regularly. However, when unemployment is higher or businesses are on hiring freezes things could flip the other way. Hence, one's personal/professional network comes in handy. There are also other reasons, which I won't/can't mension on this board, which could make a difference in my job search.....

Here's what sdr posted in the other thread; I thought it was worth pulling out as that other thread is soooo long at this point:

"I am in sales with a commodity type product that is directly tied to business activity in industrial, govt, energy and service sector so I have some anecdotal evidence regarding current business conditions. As of right now through mid Feb, sales are very soft with a handful of people hitting their number across the country verses this time last year when 70% of the sales force were at or above goal. My distributors tell me it is the small mom and pop type businesses especially in and around the LA basin that are basically disappearing. Capital Good manufacturers are getting hit with delayed orders and many have laid off employees or getting ready too. The service sector that we cater to are very cost sensitive right now and are cutting back or trading down. Energy is the exception, sales into that space are actually up over last year. I have been through a few recessions and this seems different, previous downturns I have experienced seemed like business hit a brick wall and was much more pronounced. This is more like a steady deterioration that seems ever so slightly gaining momentum."

mension = mention
- to make sure I remain compliant to rigorous spelling requirements of the board :-)

cashflow,
if you need a bag sewn, check us out: www.garymanufacturing.com

We're one of a few manufacturers left specializing in commercial/industrial sewing in the San Diego region.

The internet and China radically changed out business in the last few years. It's been both good and bad. We do produce some goods offshore, but we like to keep 99% of it here obviously. Some of our people have worked for us for over 20 years, so you can imagine the pressure I feel when I lay off someone who's depending on me.

JWM in SD

Uh, that was not sdr. It was LA Renter who posted that. Please do not attribute posts incorrectly...especially to pompous windbags like sdr.

aah yes, I see that now. Looks like his cut and paste threw me.

I should have recognized the humble tone did not match sdr! LOL!

lindismith I see that you manufacture body bags and incontinence wear. I would think that soon you'll be in demand when the sh*t hits the fan and the baby boomers retire! Good luck to you.

JWM: I was scratching my head too. sdr posts are usually cheerleading propaganda for the real estate industry and how it couldn't possibly go as deep as reality is showing all of us that IT IS going to go.
LOL!

when the sh*t hits the fan and the baby boomers retire!

Yes, a diversified product line keeps us alive when times are tough!

I have great stories about the types of inquiries I get for both of those items. People are strange is all I can say.

Hi LS,

I will contact your company to see if it's a possible fit for what we need. I have been looking for something local.
If you're in sales there, contact me direct so we can discuss!
myaquabag [at] gmail [dot] com

Thanks!

Body bags...
Maybe lindismith will enlighten us when body bag sales increase. That could be informative.

LOL!

Body bags are a commodity item produced mainly offshore these days. I am still shipping to many companies but new inquiries tend to come from the Middle East (not the wars - the military has massive contracts,) but from general medical supply companies that have been coming online over the last few years; I think I'm getting their business simply because I respond to their requests.

Just received an email my freight brokers who seems to be feeling it. He writes:

Greetings All,

Hope you are having a good week so far. Food for thought:

Is the economy heading towards a recession? As you may already know, this may very well be the case and the inevitable truth...."

He goes on about defining a recession and then, "With this being said, this directly correlates to what I do as your Consultant, Freight Broker, and personal Sales Representative with the business we’re in. I would like to see what I can do to retain as well as earn more business during these trying times. Any input or feedback to what I can do to further and strengthen our relationship would be greatly appreciated. As your Account Manager, you will be provided with the best possible service in the ‘transportation world’ as I am here for the long haul!

Let me know if there is anything I can help out with. I appreciate your time and value your business. Have a great day.

Sincerely,
"

I've left off his name, but suffice it to say, I never get emails like this.

lindismith

Seems to be at odds with what I am hearing from a friend. Their international business is surging and they are able to come in at full price on Tenders (RFP) for project due to the currency exchange. I would think the the shipping industry would benefit form this environment. Just a thought.

Ray, I think it depends on what sector your friend is in, what international ports they are shipping to, and what type of freight/transport is required.

My international biz is also up.

My local guy, servicing my local freight is down.

What does your friend sell? And to whom?

I always feel low interest rates.

Actually I'm in the market for some extra pompous windbags. LindiSmith could you sew a few for me?

Since we're in the story-telling mode, maybe lindismith can enlighten us with some stories of the incontinence product inquiries!