3 replies to this topic

[scm]

Stepford No More

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In his article in The Atlantic Monthly titled “The Next Slum?” Leinberger projected that today’s affluent suburbs could become tomorrow’s slums, “characterized by poverty, crime and decay.” Though this may be extreme, it’s possible that the suburbs will soon fall out of favor with many middle class Americans. Investors and developers should do what they can to prepare for the shift.

[scm]

More on the same general topic, from today's WSJ:

With Gas Over $4, Cities Explore Whether It's Smart to Be Dense

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Sacramento -- yoked to the car and mired in one of the lousiest housing markets in the country -- offers an intriguing laboratory for that idea. Four years ago, just as oil was gaining momentum in its torrid climb to $140 a barrel and beyond, the six-county region adopted a plan for growth through 2050 that roped off some areas from development while concentrating growth more densely in others, emphasizing keeping jobs near homes.

[Telmnstr]

I've watched "End of Suburbia" a number of times. I've got a few other documentaries on oil crisis. But there are a few things overlooked.

A, if cities like Norfolk weren't stupid, and went with elevated maglev train or maybe monorail, it would be possible to do commuter rail out to the suburbs. According to End of Suburbia, there used to exist this in the form of light rail (like that which they are putting down again) but it was bought and removed by motor companies and tire companies to drive the auto industry. This is one solution to help sustain suburbia.

B, electric cars and other alternative fueled vehicles. The only reason these aren't more common is oil is cheap. But with oil higher priced, now electric (and perhaps other fuels) are a viable market. There are a number of electric plug-in cars that are supposedly coming to market.

C, bicycles aren't bad.

D, there just aren't a ton of jobs in city centers. What businesses are in downtown Norfolk? Law firms, Norfolk Southern, a few tech companies. It's an expensive place to exist to do business. Many of the people that work at these companies are already fairly well off, and $5/gallon gas doesn't hurt them that much. For the lower end jobs, they likely don't pay enough to warrant living downtown. Commuting could still be cheaper.

E, will we see a speculative mania on downtown areas? I doubt it. I think oil will revert to low prices. In fact, I think the reason for the price jump in oil is the death of the housing bubble. People looking for good returns moved to oil, it's where the hype is. Yes China wants cars. But they too can use alternative fuels.

This whole mess is more about a credit bubble (too much money lent to people who can't pay it), and the US dollar falling in value.

[calwinston]

James Howard Kunstler: "The Tragedy of Suburbia"

Edited by calwinston, 05 May 2010 - 08:12 PM.