Timber...

Just in case you think the old paradigm is alive and kicking, and that we are coming out of the woods now or anytime soon..... we have not even entered the woods yet! Here are some quotes from Doug Hornig's article "If You Thought the Housing Meltdown Was Bad" at escapefromamerica.com:

...wait until you see what’s in the cards for commercial real estate... the next train wreck will be in commercial real estate. Couldn’t be worse than last year’s residential market crash? That remains to be seen. But it’s coming soon, probably as early as the second quarter of next year, and there’s nothing that can prevent it... make no mistake about it, that train is going off the tracks no matter what. Every part of the sector – from multifamily apartment buildings to retail shopping centers, suburban office buildings, industrial facilities, and hotels – has accumulated a huge amount of defaulted or nonperforming paper. It’s an impossible, swaying structure that cannot long stand.
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As the overall commercial real estate crisis escalates, the banks will do the same thing they did last year: run to the government, palms outstretched.
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Rock, meet hard place. Let all the troubled banks fail, and the consequences will range from some excruciating but short-term pain, to a plunge into full-bore depression. Prop them up with yet more newly printed fiat money, and anything from high to hyperinflation will inevitably result, along with the possibility of extending the problem well into the next decade.

Both are frightening prospects. We don’t want either, but realistically, we’re going to get one or the other. Let’s be clear, it won’t be the end of the world. However, it will be the end of the world as we know it. That makes it imperative to prepare for the new one that’s coming.

Spot on Doug - and this is not just a US problem, it is global - Dubai is just the canary in the coal mine (how I love to mix my metaphors, but then coal was once trees...). Never mind about the old decaying giants that are about to collapse around our ears...(timberrrr....) It is inevitable that the banks will, very soon, choke on their own vomit, bringing down the governments that have bought into them too. It is all too huge and too imminent for any of us to be able to fix it, and so we must get busy planning for the replacement.

Goodbye to the old economic and political structures. Make way for new growth!