Just Asking
Last November, the much maligned federal Resolution Trust Corp. finally had something to boast about when it auctioned off the Doubletree resort near Palm Springs for $18.5 million, still the largest property the agency has ever auctioned.
So here it is nine months later and the sale still hasn’t closed. What’s up?
RTC spokesman Steve Katsanos says the planned sale to Los Angeles investor Charles Lee turned messy, as is the case with many properties the RTC sells that formerly belonged to dead thrifts. But he insists that the sale is in no danger of unraveling.
The sale started getting sticky when condominium owners at the resort exercised their option to buy 18 holes of the resort’s 27-hole golf course. That $5-million purchase will in turn knock Lee’s price for the hotel and the remaining nine holes down to $13.5 million, Katsanos said.
Still, he said, taxpayers will be getting the same amount, provided that last-minute details are ironed out over the next couple of weeks between all parties.
Megaton of Savings
Our favorite title for an economic study this year comes courtesy of the University of Michigan’s Joel Slemrod and Yale University’s Bruce Russett.
The two have published a working paper titled “Diminished Expectations of Nuclear War and Increased Personal Savings: Evidence from Individual Survey Data.”
Slemrod and Russett make a case that an unexpected “peace dividend” could come through enhanced savings because people are less worried about the bomb.
As they put it in academicspeak, “someone who believes that a ‘world’ or ‘nuclear’ war is likely to occur within the next 10 years or so would be expected to have a much higher discount rate for benefits in that time period than is someone who believes war is unlikely: the person typically does not expect to survive the war.”
For those who had trouble following, here’s the translation: People will spend as if there is no tomorrow if they think that there is no tomorrow.
Good Old Days
An excerpt from a Feb. 27, 1984, Forbes magazine cover story on California:
”. . . if the economy goes as well as the Department of Finance thinks it could for the next two years, the state could be generating so much tax revenue that (then-Gov. George) Deukmejian might be forced to cut taxes.”
Briefly . . .
Maybe it’s not so bad here after all: A World Bank report notes that 800 people on average die annually in Turkey from earthquakes, while some 4,700 buildings collapse or are heavily damaged . . . BankAmerica is considering selling some of the branches to be closed in the wake of its Security Pacific acquisition to fast-food chains such as McDonald’s and Burger King . . . No respect: Liquidators of property are calling themselves real estate’s “most underrated professionals.”
