U.S. Mall-Vacancy Nightmare


Inquiring minds are considering a very interesting article by Jeff Nielson regarding the mall-vacancy problem that is getting worse:

It is in this context which we must view the terminal decline in the U.S. retail sector. Unlike governments, who can simply print money to (temporarily) cover-up their economic delusions, U.S. retailers have no such luxury. Propaganda doesn’t pay the bills. Thus, the retailers themselves now understand that they face a multi-decade period of retrenchment in their sector.

Th recent past has not been kind:

The first shock-wave of U.S. shopping mall bankruptcies is now more than a year behind us, with the bankruptcy of General Growth (the second-largest U.S. mall owner) by itself leading to the bankruptcy of 158 malls (roughly ¾ of its total holdings). In even a semi-healthy economy, the largest wave of retailer and mall bankruptcies in history should have been enough to restore balance to this sector. However, recent data totally shatters that scenario.

And the present isn’t any better:

U.S. shopping-mall vacancies are once again approaching an all-time record (in the 30 years over which such data has been collected) – and are actually higher than before the first wave of bankruptcies. This horrific devolution in the U.S. retail sector has two “drivers”, above-and-beyond the general economic fundamentals which I outlined previously.

And, finally, the future:

Ultimately, the death-spiral of the U.S. retail sector is a very simple “equation”. No jobs = no money. No money = no consumption. No consumption = no retailers. As with most of the U.S.’s economic woes, this catastrophe cannot be dealt with by wall-papering the problems with propaganda – and then hoping they will solve themselves with time.

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