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Boston's eminent decline (the canary in the coal mine)

 
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Boston ITer
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PostPosted: Mon Sep 03, 2007 3:07 am GMT    Post subject: Boston's eminent decline (the canary in the coal mine) Reply with quote

http://tinyurl.com/298aqn

Excerpt:

Quote:
On Tuesday, the London Times reported that Boston-based bank, State Street Corporation (nyse: STT - news - people ), had an exposure of $22 billion to asset-backed commercial paper conduits. In the wake of the credit debacle, a chill in the commercial paper market has rocked these investments, battering the financial institutions that hold them. Citing regulatory filings, the Times said 17% of State Street's assets reside in these off-balance sheet conduits.

While many investors were aware of State Street's exposure to the subprime crisis,"what is new today, is the magnitude. No one knew that $22 billion was the measure of exposure," Punk Ziegel analyst Richard Bove said Tuesday.



Ok fellows, how many more top tier MA firms have to buckle before it's obvious that our long term viability is at stake?

Let's face it, Fidelity Investments, Gillette, Boston Scientific, Serono, and a host of others were in decline and standing in line for a Mass exodus (pun intended) but as always, the optimists pointed to State Street, Mass General hospital, and MIT/Harvard as the mainstays of the region. Well, if companies really aren't interested in sticking around then what's stopping us from becoming like New Haven, a ratty post-industrial town with an ivy league college (plus medical center)? Or perhaps at best, Buffalo NY, a rust belt city with colleges, hospitals, and a popular football team?
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PostPosted: Mon Sep 03, 2007 3:31 pm GMT    Post subject: Reply with quote

22 Billion? And here I was thinking that State St was a prudent shop and not a speculative operation.
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PostPosted: Tue Sep 04, 2007 12:47 am GMT    Post subject: Reply with quote

I think this thread's got everyone speechless.

And as far as I'm concerned, I suspect that many had an inkling of it, back during the whole credo of MA never going down (the standard excuses, cerca 2001 to 2006) which was the main reason for buying in Boston because the region's a magical haven for brains, new enterprises, and blue chip mainstays, a Shangri La for the modern corporate research, development, and propagation.

Sorry folks, that was 1985, not today.
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john p



Joined: 10 Mar 2006
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PostPosted: Tue Sep 04, 2007 11:47 am GMT    Post subject: Reply with quote

http://www.finfacts.com/irelandbusinessnews/publish/article_10002284.shtml

It looks like lots of other countries are in the same boat. I think if it was just Boston we'd have real problems, but I'm not sure how this all resolves other than major currency devaluation.
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john p



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PostPosted: Tue Sep 04, 2007 11:57 am GMT    Post subject: Reply with quote

http://www.cbsnews.com/stories/2006/12/08/world/main2240179.shtml

This article has a report saying that 72% of Brits between 20 something and 34 are considering relocating to another country.
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john p



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PostPosted: Tue Sep 04, 2007 5:03 pm GMT    Post subject: Reply with quote

US from 1997 to 2005 - prices grew approx. 127%

Massachusetts 1997 to 2005 - prices grew approx. 148.5%

UK from 1997 to 2005 - prices grew 154%

According to this, 70% of mortgages in the UK have variable rates

http://www.rics.org/Property/Residentialproperty/Residentialpropertymarket/Housing%20market%20impedes%20early%20UK%20entry%20into%20Euro.html


In fact, housing trends are going to be an issue with the Euro and the nations using it as a medium of exchange. House prices in the UK are exceeding the Euro growth.

http://www.thisismoney.co.uk/mortgages/house-prices/article.html?in_article_id=423872&in_page_id=57&ito=1565

Check out UK's "Brownie, you're doing a heck of a job".

http://news.bbc.co.uk/1/hi/business/2976326.stm
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