Public Works Bids

I can't imagine how the market can make any real headways when the news keeps getting worse regarding the every day Joe out there. It reminds me of the real estate market when everyone thought that it was not going to last long. I believe we are in a depression. You already have double digit unemployment in some states - Michigan, Rhode Island for example. But that said, I wanted to share with you something that was amazing to my husband and I here in Orange County Florida. We've lived here for 23 years and we've never seen anything like this My husband is one of the managers in public works. They just put out a bid go out for 1.7 million for a public work project (that's a small bid but we haven't had a bid go out for a while). They had 17 bids on this project. Guess how much the county got for the project? The lowest bid came in at about $680,000!! People are lowering bids drastically just to get work. All we need are the bread lines now! Too bad the counties didn't have enough money to capitalize on these cheap bids. I stick with my ta and try not to put the fundamentals in there. But this time, it's so hard to think we can even have a short term cyclical bull market within this secular bear. The worst is still to come and despite the market is a discounting mechanism...I would think we have to hit a much higher unemployment rate before we start discounting any type of recovery. And no matter what they pass in the stimulus - timing is everything for survival. For some - it's too late. Just thought I'd share what is going on with one of the largest counties and well managed counties in Florida. People are scared. The county is worried about running out of money too. The county will do everything they can to hold onto people's jobs as they already freezed everything and everything is slowing down to a snail's crawl...but they too are considering less hours to reduce costs and keep jobs. And we are a well managed county... Peace... Irene

Edited by tradermama, 30 January 2009 - 07:29 AM.

tm: i hope/think part of the stimulus is funding $$$ directly to city and county and states quality projects like that. then criticism is that this part won't matter for many moons. i think they are wrong; many projects are shovel ready and just need the $$$. is that your view?

Actually, I'm hoping to get some views from folks with similar perspectives all over the country. I really have no idea what projects are ready to go and which ones aren't even around here. I'm suspecting that some of that money is going to make it into city and county housing departments and I think that will bring immediate action, but the economic effect will likely be longer-term urban renewal. That's stimulatory (lemme tell you, is it!) in that this requires a lot of stuff and creates some not insignificant demand for labor, but I know it takes quite a while to get the rubber on the road. Mark

tm:

i hope/think part of the stimulus is funding $$$ directly to city and county and states quality projects like that. then criticism is that this part won't matter for many moons. i think they are wrong; many projects are shovel ready and just need the $$$.

is that your view?

HI..not necessarily..they are getting ready for projects..however, they really dont think it will be a lot down to the county..the states will get it first..and projects except what i mentioned virtually have come to a dead stop...it is not as rosey as one might think...and the longer we wait..the worse it will get...but the amount won't be the silver bullet you might be hoping for...our county has always been one of the best nationwide...so this is a good benchmark i am monitoring..the good news to this was there was a project to bid on..the bad news is..the county can't take advantage of these cheap bids because there is no money...and the amount of money they get might not make a big difference..we shall see..i hope for the best..I know personally we are fine..but I feel for so many hourly wagers..they are the ones that will get hit the hardest...we've been there for 20 yrs..

Actually, I'm hoping to get some view from folks with similar perspectives all over the country. I really have no idea what projects are ready to go and which ones aren't even around here.

I'm suspecting that some of that money is going to make it into city and county housing departments and I think that will bring immediate action, but the economic effect will likely be longer-term urban renewal. That's stimulatory (lemme tell you, is it!) in that this requires a lot of stuff and creates some not insignificant demand for labor, but I know it takes quite a wile to get the rubber on the road.

Mark

Mark..as I hear things from my end ..I will post..I pay attention to all the info I get...permit starts, projects, etc....this is how I also knew when to have sold my property..I picked the top in real estate between this and when I heard that Toll Brothers missed in Oct 2005 ....for the first time I think in 40 yrs..and I was monitoring listings then too as I was preparing to sell one of my homes.....I always pay attention to things they say are "The First time"...that's another reason why I don't think we are going to see a cyclical bull yet...too many "The First times" still waiting to come out..imo



Irene

tm: i look forward to your updates; it sounds like they would be valuable real-time feedback on what is really happening with the public works part of the package. the $20 billion for hospital digitizing will be very quickly spent. and the small business capex write-offs helpful for many manufacturers. i WOULD like the "buy america" requirement, so i guess i am a horrible protectionist.

http://online.wsj.co...lPage#printMode

A 40-Year Wish List
You won't believe what's in that stimulus bill.


"Never let a serious crisis go to waste. What I mean by that is it's an opportunity to do things you couldn't do before."

So said White House Chief of Staff Rahm Emanuel in November, and Democrats in Congress are certainly taking his advice to heart. The 647-page, $825 billion House legislation is being sold as an economic "stimulus," but now that Democrats have finally released the details we understand Rahm's point much better. This is a political wonder that manages to spend money on just about every pent-up Democratic proposal of the last 40 years.
[Review & Outlook] AP

We've looked it over, and even we can't quite believe it. There's $1 billion for Amtrak, the federal railroad that hasn't turned a profit in 40 years; $2 billion for child-care subsidies; $50 million for that great engine of job creation, the National Endowment for the Arts; $400 million for global-warming research and another $2.4 billion for carbon-capture demonstration projects. There's even $650 million on top of the billions already doled out to pay for digital TV conversion coupons.

In selling the plan, President Obama has said this bill will make "dramatic investments to revive our flagging economy." Well, you be the judge. Some $30 billion, or less than 5% of the spending in the bill, is for fixing bridges or other highway projects. There's another $40 billion for broadband and electric grid development, airports and clean water projects that are arguably worthwhile priorities.
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Add the roughly $20 billion for business tax cuts, and by our estimate only $90 billion out of $825 billion, or about 12 cents of every $1, is for something that can plausibly be considered a growth stimulus. And even many of these projects aren't likely to help the economy immediately. As Peter Orszag, the President's new budget director, told Congress a year ago, "even those [public works] that are 'on the shelf' generally cannot be undertaken quickly enough to provide timely stimulus to the economy."


Most of the rest of this project spending will go to such things as renewable energy funding ($8 billion) or mass transit ($6 billion) that have a low or negative return on investment. Most urban transit systems are so badly managed that their fares cover less than half of their costs. However, the people who operate these systems belong to public-employee unions that are campaign contributors to . . . guess which party?

Here's another lu-lu: Congress wants to spend $600 million more for the federal government to buy new cars. Uncle Sam already spends $3 billion a year on its fleet of 600,000 vehicles. Congress also wants to spend $7 billion for modernizing federal buildings and facilities. The Smithsonian is targeted to receive $150 million; we love the Smithsonian, too, but this is a job creator?

Another "stimulus" secret is that some $252 billion is for income-transfer payments -- that is, not investments that arguably help everyone, but cash or benefits to individuals for doing nothing at all. There's $81 billion for Medicaid, $36 billion for expanded unemployment benefits, $20 billion for food stamps, and $83 billion for the earned income credit for people who don't pay income tax. While some of that may be justified to help poorer Americans ride out the recession, they aren't job creators.

As for the promise of accountability, some $54 billion will go to federal programs that the Office of Management and Budget or the Government Accountability Office have already criticized as "ineffective" or unable to pass basic financial audits. These include the Economic Development Administration, the Small Business Administration, the 10 federal job training programs, and many more.

Oh, and don't forget education, which would get $66 billion more. That's more than the entire Education Department spent a mere 10 years ago and is on top of the doubling under President Bush. Some $6 billion of this will subsidize university building projects. If you think the intention here is to help kids learn, the House declares on page 257 that "No recipient . . . shall use such funds to provide financial assistance to students to attend private elementary or secondary schools." Horrors: Some money might go to nonunion teachers.

The larger fiscal issue here is whether this spending bonanza will become part of the annual "budget baseline" that Congress uses as the new floor when calculating how much to increase spending the following year, and into the future. Democrats insist that it will not. But it's hard -- no, impossible -- to believe that Congress will cut spending next year on any of these programs from their new, higher levels. The likelihood is that this allegedly emergency spending will become a permanent addition to federal outlays -- increasing pressure for tax increases in the bargain. Any Blue Dog Democrat who votes for this ought to turn in his "deficit hawk" credentials.

This is supposed to be a new era of bipartisanship, but this bill was written based on the wish list of every living -- or dead -- Democratic interest group. As Speaker Nancy Pelosi put it, "We won the election. We wrote the bill." So they did. Republicans should let them take all of the credit.


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i'm a big believer amtrak. we need to have a massive upgrade program, especially in urban areas. for a succesful rail system you have to build it and they will come. if you have ever been on "the meatgrinder" I-95 from DC to NYC you will understand the need.

Edited by humble1, 30 January 2009 - 09:48 AM.

Amtrak is a money pit and always has been. If it's so good, why does it lose money? M

how much money does the interstate highway system make?