Analysis The University of Oregon Index of Economic Indicators™ fell sharply in October to 90.2 (1997=100), a 0.7 percent decline from the previous month. Compared to six months ago, the UO Index is down 8.0 percent (annualized). Indicators pointed to widespread weakness; five of the seven variables declined from the previous month, while only one, the interest rate spread, improved. The remaining indicator, Oregon building permits, remained unchanged.

The UO Index indicates that, like the nation as a whole, recessionary conditions in Oregon intensified in October.

Oregon labor markets deteriorated significantly. Initial unemployment claims jumped to a weekly average of 10,805, exceeding the peak of 10,245 reached during the 2001 recession. Payrolls at employment services agencies declined again in October and stand 6.5 percent below October 2007 levels. This sector is dominated by temporary help agencies, whose employees are often the first laid off by struggling firms. Nonfarm payrolls (not included in the UO Index) fell sharply during October as firms, on net, shed 14,100 workers. Declines were widespread; employment fell in virtually all major sectors of the economy.

Residential building permits (smoothed) continue to hover near 1,000, having stabilized at low levels for the past four months. Still, note that permits are below the levels of the 2001–3 period of weakness. New orders for nondefense, nonaircraft capital goods, adjusted for inflation, fell sharply in October as the intensifying credit crunch and signals of softer consumer demand prompted firms to delay capital spending. This sharp shift in firm behavior will deepen and lengthen the recession. U.S. consumer confidence (smoothed) fell slightly, still indicating very weak consumer spending growth. While lower gasoline costs will support spending, the impact will be at least partially offset by rising joblessness. Oregon trucking activity, as measured by the weight-distance tax collected, fell in October, consistent with weakening demand. The yield spread—the difference between short- and long-term interest rates—rose as the Federal Reserve cut its target for rates on overnight loans. Typically, a rising yield spread signals improving economic conditions.

Impairment of the financial markets, however, is limiting the impact of monetary policy, suggesting that the yield spread has lost some effectiveness as an indicator during this recession.

The UO Index indicates that Oregon remains mired in recession with little chance of significant improvement in the near term (three to six months). Note that growing momentum for a federal stimulus package, if enacted quickly and of sufficient size, should offer support to economic activity by mid 2009.

### Please visit the report here

Oregon’s hospitals have a shared objective with the governor, the Oregon Health Fund Board and members of the Oregon Legislature when it comes to increasing health care access for all Oregonians, especially children.  Access to appropriate care, as well as to state, federal and commercial insurance programs remains one of our single most important policy priorities.

At the same time, however, we struggle to understand the rationale and wisdom of financing the lion’s share of this critical increase to the Oregon Health Plan through a 4% hospital tax on Oregon’s community hospitals.  This financing approach has implications that will ripple through communities across the state at the very time when Oregon’s hospitals are facing a severe downturn in their net operating revenue.  On average, hospital margins in this state continue to decline year over year.  In 2007, the average margin was 3.9%, an amount less than the amount of the proposed hospital tax itself.

At today’s press conference, the governor asserted that hospitals will more than recover this tax as the result of a reduction in the amount of uncompensated care they provide today.  These assertions are simply inaccurate.  Hospitals will undoubtedly see a variable decrease in the number of patient’s who have no insurance coverage at all.  Unfortunately, Oregon’s Medicaid program historically pays providers far less than the actual cost of providing care. As such, hospitals can not simply make it up on volume.

At the same time, we will still have more than 500,000 citizens in Oregon with no health insurance who must seek care when and where they need it, regardless of their ability to pay.  We must all recognize that the number of uninsured Oregonians will continue to rise at record rates, at the same time that Oregon’s provider community is facing considerable payment reductions and other changes from the Medicare and Medicaid programs.  This budget further decreases already reduced payment rates by an additional 10%.  As a result, with the significant burden of an increased hospital tax, Oregon’s policy makers could be creating the perfect storm for an increasingly fragile health care delivery system.

With the 2009 Legislative session commencing in 5 weeks, we strongly encourage the governor and legislative leaders to work in concert with the hospital community in order to find a solution that can work for all concerned – most importantly our state’s uninsured citizens.  This is the path that we have taken together in past sessions and one which has proven quite successful for the neediest Oregonians.

Oregon’s hospitals remain committed to finding and supporting a sustainable long-term solution to our critical health care cost and access problems.  It is our mission.

Andy Davidson
OAHHS president & CEO

ZDNet reports that web traffic (although not sales) was significantly up on Cyber Monday — the heavily watched day for internet shopping after Black Friday.

With today’s economy in a tailspin one of our state’s leading industries is being hit harder than most.  The Oregon restaurant industry employs an estimated 110,000 and creates a whopping economic impact of 9.7 billion dollars annually into our economy.  With more than 9,000 restaurants and food service outlets throughout the state it appears the short end of the stick has been given to the restaurant industry during today’s economic downturn.

“Three to four weeks ago the restaurant business just dropped off,” explains Bill Perry vice president of government affairs for the Oregon Restaurant Association.  “People just stopped going out to eat and a 30-40 percent decline appeared to occur over night.”

During the first three quarters 2008, the Association saw the downturn begin with a four percent decline. Rising fuel costs drove up food prices by eight percent in the first two quarters of the year. “Generally, if you have a four percent downturn you can make some shifts and survive,” explains Perry. “But when you have a decline in revenue and a growth in the cost of products it gets even more difficult.”

Oregonians are eating out by going the quick service route rather than the more typical mid-range restaurants.  Today, “Mom and Pop” independents, in addition to the mid-range restaurants, are getting hit harder. High-end restaurants tend not to experience the pain as badly due to expense account clienteles and special event spending.

A new survey by NPD Group, a global consumer and market research firm, illustrated that when consumers trim their dining out budget first, when trying to reduce their spending.  A recent survey showed fifty-seven percent of consumers are planning to dine out less often during the economic slow down. “Hopefully families will being getting out to eat during the Christmas season,” says Perry.

2008  — Shoppers: 172 million,  Average spent: $372.57
2007 — Shoppers: 147 million, Average spent: $347.55

National Retailers Foundation shows shoppers spent 7% more. and 30 million more shoppers durign Black Friday weekend.

The government’s latest plan (as of today, November 26, 2008) has the Fed buying mortgage-backed securities from Fannie, Freddie and the gang.  I’m OK with the program in general, but here’s a bit of hubris I cannot tolerate: the claim that it will help the housing market.

Housing consists of owner-occupied (or increasingly owner-unoccupied) plus rental housing.  The proportions are roughly two-thirds owned, one-third rented.  Bringing down mortgage interest rates will help one sector of the market, but only at the expense of the other.  As I showed with charts in this post from a couple of weeks ago, we have an excess supply of both types of housing.  There is no solution to the excess supply of housing other than to have a good-sized fire, or grow our population.  The latter solution works, and works well, but at a slow pace.  We grow our population by about one percent per year, so we’ll eventually grow to fit our housing stock.

Here’s what I like about the plan:  it silences critics of the Fed who say that they don’t have much room to ease monetary policy.  Sure, the Fed Funds rate is less than one percent, so the usual interest rate that the Fed influences cannot be moved much further.  But the Fed can conduct monetary policy in any number of instruments, including mortgages.  (Many years ago, the Swiss wanted to conduct open market operations but there were no Swiss treasury bonds outstanding, because the country had been running a balanced budget.  So their central bank conducted monetary policy buying and selling mortgages rather than treasuries.  No problem.)

##

Bill Conerly is principal of Conerly Consulting LLC, chief economist of abcInvesting.com, and was previously Senior Vice President at First Interstate Bank. Bill Conerly writes up-to-date comments on the economy on his blog called “Businomics” and produces a monthly audio magazine available on CD. Conerly is author of “Businomics™: From the Headlines to Your Bottom Line: How to Profit in Any Economic Cycle”, which connects the dots between the economic news and business decisions.

ShopLocal reports a 21% increase in Black Friday deals compared to 2007.  Stores are scrambling to get the most out of a drop in consumer spending and a diminishing economy.

Deals may be up, but freebies offered by stores appeared to be in decline in Oregon.  The Oregonian Black Friday advertisements show only one department store offering free gifts to the first customers compared to two to three stories in years prior.  In 2007, two sporting goods stores offered free gift cards ranging from $5 to $500 to the first 200 customers.  This year saw only one outlet (Joes) offering such free gift cards.

Local stores are also offering advanced purchase of Black Friday deals during the weekdays before Thanksgiving.  Woodburn Outlet Mall has been advertising their opening of their deals at 11:00 on Thanksgiving night which is pushing the outreach of shoppers into the Thursday.

Best wishes and thankfulness from Oregon Report

“Oregon?s gas prices are at their lowest level since March 2006. The statewide average for regular unleaded drops another 16 cents this week to $2.22. The national average falls another 15 cents to $2.07 and is at its lowest level since March 18, 2005.”AAA Oregon Public Affairs Director Marie Dodds says, “Both averages are about a dollar lower than they were a year ago, and are about 50% lower than the record highs of more than $4 a gallon we set in July.”

The national average for diesel also drops below $3 per gallon this week for the first time since September of last year. And Oregon?s average for diesel is just above $3 per gallon, also at the lowest point since September 2007.

Crude oil prices are at their lowest level since late January 2007. Crude is trading at about $55 per barrel today, down from around $59 a barrel last week. Crude prices are down about 63% from the record high of $147 per barrel set on July 11, 2008.  Investors are concerned about the faltering global economy and a decreasing demand for oil and gas.

AAA expects to see gas prices stabilize and possibly even rise slightly just before Thanksgiving, but a national average of $2 per gallon is still expected over the next few weeks. Despite lower gas prices, consumers face a number of economic challenges and AAA projects a slight drop in the number of Thanksgiving travelers this year. Approximately 41 million Americans will travel 50 miles or more from home this Thanksgiving holiday weekend, a decrease of 1.4 percent from last year’s total of 41.6 million. “This is the first decline in Thanksgiving holiday travel since 2002 and is the fourth consecutive travel holiday this year with a year-to-year decline in the number of travelers,” says Dodds.

The average price of gas is below $2 a gallon in 17 states, up from four last week. Oregon?s gas prices are 11th highest in the nation for the third week in a row. This week two states have gas at or above $3 per gallon, same as last week. The most expensive gas in the country for the 21st week in a row is Alaska at $3.15, followed by Hawaii at $3.00, New York at $2.44, California at $2.34 and District of Columbia at $2.32. Washington is 13th highest, up from 14th last week, with its statewide average falling 15 cents to $2.21. Missouri has the least expensive gas in the country for the second week in a row at $1.77.

Diesel prices also continue to drop. Oregon?s average drops 16 cents this week to $3.01, while the national average loses 13 cents to $2.96. Hawaii has the highest statewide average price for diesel again this week at $4.58, followed by Alaska at $4.15, New York at $3.47, District of Columbia at $3.47, and Connecticut at $3.34. Oregon?s diesel prices are 17th most expensive this week, down from 15th last week. Washington?s diesel price is $3.07 which is 14th highest, down from 13th last week. A year ago, the national average for diesel was $3.45 and Oregon?s average was $3.59.

Get the latest fuel prices at AAA?s Daily Fuel Gauge at www.fuelgaugereport.com. For a comparison of fuel prices across the nation, go to the AAA Fuel Price Finder at www.AAA.com.

With the recent announcement of Starbucks’ new evolution of card rewards that “takes the next step in putting money back in loyal customers’ wallets,” one may think Starbucks needs the money in its own back pocket after a 97 percent profit drop. However, Starbucks is one of many businesses to suffer severe reduced profits in the current economic crisis, and there is no evidence to conclude that these businesses cannot recover from the profit decrease.

Businesses from all sectors are beginning to feel the pinch of the poor economy.   For example, retail store J.C. Penny’s profits dropped 52 percent and the Cheesecake Factory Inc. dropped 36 percent in their third quarters.    More locally, the Oregon Shakespeare Festival announced they will cut back $1 million for its 2009 budget, one of the greatest financial crises in the history of the organization.

Starbucks rebound plan

Starbucks introduced new products and services in the last several months such as the Clover coffee brewing method, Mastrena Espresso Machines and healthy breakfast options to help offset sinking profits.

While the new direction of the organization could not significantly counter the profit drop in time, the large fall of stock during the current economic crisis, often compared to the Great Depression, should not come as a surprise. Nevertheless, it is too early to judge the fate of a business by one large profit decrease in an unstable and unpredictable market.

Howard Schultz, chairman, president and CEO of Starbucks, commented that the company appears to be more resilient than many other premium brands. “With a re-architected cost structure at the close of fiscal 2008, we began the new fiscal year with a healthier store portfolio that will allow for operating margin expansion,” he said. “Despite a global economic environment which shows no immediate signs of improvement, the steps we took in FY08 position us to deliver EPS growth in FY09.”

Starbucks’ fourth quarter fiscal 2008 summary reported that the coffee company’s profit dropped $154.1 million, from a net income of $158.5 million from the same period last year to $5.4 million today.

Starbucks claimed the drop in the fourth quarter was due to less customer consumption, as well as restructuring charges totaling $99.2 million.  This includes the closing of 600 company-operated stores in the U.S. and 61 company-operated stores in Australia and cutting approximately 1,000 open and filled positions.

A reporter called yesterday for a retrospective on my forecast of a year ago.  I groaned, thinking the headline would be “Gotcha!”  Be the actual quotes he had weren’t so bad.  Apparently I said that we had overbuilt housing and that it would take a couple of years at least to work off the excess supply.  Boy, that sounds right.

Confirming that is an interesting article from the Wall Street Journal’s Real Time Economics which says in 2005 there was a burst of stories about a housing bubble.  Here’s their chart, based on 50 major daily newspapers and how often stories refer to a housing or real estate bubble. (Hat tip to Arnold Kling at EconLog.)

By the way, the peak month for housing starts was January 2006, so the bubble stories in the press really gave you some lead time.  In the fall of 2005 I was titling my economic outlook speeches, “Bubble Trouble?”

The other quote the reporter cited was my statement that there was one chance in four of a recession in the coming year.  OK, I wished I had said there would definitely be a recession, but here’s what I added to that one chance in four remark:

“If you heard that there was one chance in four of your building catching fire, you’d work out evacuation plans and you’d buy insurance.  Well, one chance in four of a recession means you should develop a contingency plan for an economic downturn.”

I feel good about having said that.  So here’s the takeaway for business leaders:  It’s hard for us to get all the details right, but when we economists say there’s a bubble, get worried.  When we tell you it’s time for some contingency planning, get to it.

]]> http://oregonbizreport.com/2008/11/did-we-economists-miss-the-housing-problem/feed/ http://oregonbizreport.com/2008/11/weekly-news-quiz-1121/ http://oregonbizreport.com/2008/11/weekly-news-quiz-1121/#comments Fri, 21 Nov 2008 10:00:31 +0000 admin http://oregonbizreport.com/?p=443 Test your knowledge on what happened this week.

1. What economic index saw its largest single month fall since before World War II this week?
1) Consumer Confidence
2) Consumer Prices
3) Oil prices

2. Which Oregon museum announced 10% layoffs this week?
A) OMSI
B) Evergreen Aviation
C) Portland Art Museum
D) Oregon Zoo

3. Between HP and Home Depot Which one saw sales rise 19%, and which one witnessed a 30% decline this week

4. Oregon unemployment hit what percent this week?
A) 5.7%
B) 6.3%
C) 6.7%
D) 7.3%

5. What two warring nations came together in negotiations this week.

ANSWERS

1. What economic index saw its largest single month fall since before World War II this week?
1) Consumer Confidence
2) Consumer Prices
3) Oil prices

2. Which Oregon museum announced 10% layoffs this week?
A) OMSI
B) Evergreen Aviation
C) Portland Art Museum
D) Oregon Zoo

3. Between HP and Home Depot Which one saw sales rise 19%, and which one witnessed a 30% decline this week

HP up 19%, Hoem Depot down 30%
4. Oregon unemployment hit what percent this week?
A) 5.7%
B) 6.3%
C) 6.7%
D) 7.3%

5. What two warring nations came together in negotiations this week.

Russia and Georgia

Crude oil prices, which reached a record high of $145 a barrel in July, fell below $56 a barrel this week — a drop of more than 60% in four months. “Worldwide and domestic oil consumption has plummeted,” explained Molly Brady, President of the Oregon Petroleum Association. “Prices could keep dropping if a weak economy continues to dampen oil usage.”

According to Brady, the price of heating oil is currently $2.27/gallon — down from a peak of $4.53/gallon in July and 30% lower than this same time last November.

This is welcome relief for consumers who are paying higher food costs and worrying about shrinking home values and retirement accounts.

Unlike other states, Oregon’s heating oil dealers typically don’t buy on futures contracts. Instead, they buy fuel on the spot market which means that they buy what they need at the rack rate. “That’s good news for consumers who are buying heating oil now since they aren’t paying the high prices charged during the summer,” added Brady.

Brady has heard from heating dealers throughout Oregon that fewer households are seeking to convert from heating oil. “Conversion to other forms of heating is an expensive and time consuming process. Now more than ever, lower heating oil costs mean that it is financially unwise to convert to other heat sources.”

In spite of lower heating oil prices, many low-income and elderly households are still having difficulties paying their heating bills. Brady encourages them to contact the Low Income Home Energy Assistance Program (LIHEAP) by visiting www.oregon.gov (type “LIHEAP” into the search tool) or calling the National Energy Assistance Referral (NEAR) project toll-free at 1-866-674-6327.

The Oregon Petroleum Association (OPA) is the statewide association of fuel distributors, retailers, commercial fueling and heating oil marketers. For more information about oil heat, visit www.oregonoilheat.com.

As economic conditions have continued to worsen throughout 2008, voters have grown more concerned about protecting jobs than protecting the environment. Asked which issue they are more concerned about today, 65% of U.S. voters say they are more concerned about protecting jobs, while only 27% are more concerned about protecting the environment. This is a notable change from six months ago, when concern about jobs was higher than concern about the environment, but to a lesser degree than today. Further comparison to past data reflects a pattern of concern consistent with the economic ups and downs over the past three years, as reflected in the following table:

U.S. Voters: Jobs vs. the Environment
“Are you more concerned about protecting the environment or protecting jobs?”

As we have reported in the past, when the economy is good, or even stable, people are less concerned about pocketbook issues and more interested in other issues, such as the environment. Conversely, the build up of negative economic conditions throughout 2008 has clearly contributed to the increasing importance of jobs. Further, with current polls and consumer confidence indices reporting all time high negative perceptions of economic conditions, it is not surprising that majorities among all voter subgroups are putting jobs ahead of the environment.

Looking at specific subgroups, voters in the Mountains/Plains states, North Central U.S. and the South are all more concerned about protecting jobs than voters in the Pacific and Northeast regions. Women age 18-54 are more concerned about protecting jobs than older women and men of all ages. Concern about protecting jobs correlates to education: those with less education (i.e. 0-15 years) are more concerned about jobs than college graduates and those with post-graduate educations. By party, Republicans and Independents are more concerned about protecting jobs than Democrats, and Conservatives are more concerned about protecting jobs over protecting the environment than Moderates and Liberals. Lastly, ethnicity plays a role in perceptions, as African American voters are more concerned about protecting jobs over the environment than other voters. The following table summarizes these findings:

Please feel free to call or email with any questions.

Bob Moore Bobm@moore-info.com 503.221.3100
Hans Kaiser Hansk@moore-info.com 410.216.9856

The BBC reports that the European Commission has scrapped rules that prevent oddly-sized or misshapen fruit and vegetables being sold in Europe. The EU’s agriculture commissioner called it “a new dawn for the curvy cucumber and the knobbly carrot.”

Proponents of the scrapped rules say they were introduced to ensure common EU standards.  Critics decried the rules as examples of Euro-madness.  If the rules were madness, then surely everyone would have voted to scrap the rules.  Instead, the BBC’s blog notes that that 16 countries–mainly the big fruit and vegetable producers–voted against scrapping the rules.

If the rules were such Euro-madness, why would 16 countries vote to continue the madness?

Economists know that there was a method to the madness: the rules were designed to increase food prices and, in turn, producers’ profits.

How can beautiful fruits and vegetables increase food prices?

Adam Smith noted that meetings of people in the same industry usually result in “some contrivance to raise prices.” The contrivance is usually some agreement to restrict output, thereby force consumers up their demand curves to pay higher prices.

In an article published by the Journal of Law and Economics, Eric Fruits and his co-authors show that many agricultural cartels in the U.S. raise the prices for their crops by imposing quality restrictions on output. Produce that is too small or misshapen is not allowed to be marketed by cartel members.  Such rules raise prices in two ways:

1. Higher quality produce is more desirable to consumers. Consumers are willing to pay more for a larger beautiful melon than for a small ugly one.

2. Because some produce does not “make the grade,” quality restrictions reduce the amount available for sale.  If only “large” melons can be marketed, then the total number of melons for sale shrinks. The reduced supply of produce results in higher prices.

TARP is, of course, the Treasury plan to provide capital to banks.  There are terms of the deal described in the press and in official documents from the Treasury.  However, the deal is subject to any modification that Congress wants to make.  Section 5.3 says that Treasury may unilaterally change the terms of the deal to conform with laws passed by Congress.  This is a huge danger.

Back in the savings and loan crisis, Congress changed the terms of deals made between the government and banks.  The Supreme Court said that whenever Congress does that, the government may owe damages to the banks for violating the contracts.  (I was an expert witness in two of the damages lawsuits.)  This time round, it won’t be a violation of contract for the terms to be changed, because the contract says the terms are whatever Congress wants them to be.

The biggest fear is that the many people in Congress who want to do good deeds with someone else’s money will legislate that banks in TARP must make lots of loans to people who are not credit-worthy (again), that banks have to forgive bad mortgages, or that they not adjust adjustable rate mortgages, etc.  Banks that have not yet decided whether to participate in TARP should be very wary.  Other  citizens should be concerned about this kind of behavior.

###

Bill Conerly is principal of Conerly Consulting LLC, chief economist of abcInvesting.com, and was previously Senior Vice President at First Interstate Bank. Bill Conerly writes up-to-date comments on the economy on his blog called “Businomics” and produces a monthly audio magazine available on CD. Conerly is author of “Businomics™: From the Headlines to Your Bottom Line: How to Profit in Any Economic Cycle”, which connects the dots between the economic news and business decisions.

1. Which Oregon County has moved to a four day work week?
A) Multnomah
B) Clackamas
C) Washington
D) Jackson

2. Researchers announced that ______ was a better indicator of premature death than traditional weight measurements.
A) Cholesterol level
B) Alcohol consumption rate
C) Blood pressure levels
D) Waist Size

3. Which major company stock fell to its 1946 levels this week?
A) AT&T
B) General Motors
C) IBM
D) Proctor Gamble

4. What NW company saw its profits drop 97%?

5. Nationwide taxis strikes are putting surprising pressure on which nation’s government?
a) Italy
B) Venezuela
C) Russia
D) China

ANSWERS BELOW

1. Which Oregon County has moved to a four day work week?
A) Multnomah
B) Clackamas
C) Washington
D) Jackson

2. Researchers announced that ______ was a better indicator of premature death than traditional weight measurements.
A) Cholesterol level
B) Alcohol consumption rate
C) Blood pressure levels
D) Waist Size

3. Which major company stock fell to its 1946 levels this week?
A) AT&T
B) General Motors
C) IBM
D) Proctor Gamble

4. What NW company saw its profits drop 97%? - STARBUCKS

5. Nationwide taxis strikes are putting surprising pressure on which nation’s government?
a) Italy
B) Venezuela
C) Russia
D) China

A comprehensive citizens’ report detailing the root causes and basic problems of prostitution along Northeast 82nd Avenue should be released in early December, according to Dawn Rasmussen, president of the Save Northeast 82nd Avenue Coalition. The report would help guide businesses and neighborhoods in the area on how to effectively handle prostitution.

The plan, a brainchild from meetings uniting Northeast neighborhoods and featuring such panelists as City Commissioner Randy Leonard, President of the 82nd Avenue of Roses Business Association Ken Turner and Lila Lee from the Council for Prostitution Alternatives, will be the first aggressive attempt from the community to curb prostitution by addressing the core of the issue.

Rasmussen is optimistic about making a difference. “82nd is standing up for itself,” she said. “There is new energy, new momentum.”

She hopes the report will give the city, and potentially the nation, resources to proactively manage prostitution and other accompanying crimes in order to increase community livability. For example, the plan would outline the amount of power and extent of action police and neighborhoods have in handling situations of prostitution. Calling the police every time there is a disturbance is a short-term solution, said Rasmussen.

Justin Cutler, chair of the Montavilla Neighborhood Association who has partnered with the Save Northeast 82nd Avenue Coalition, confirmed previously reported incidences of Montavilla parents sweeping little league baseball fields for condoms and needles before their children’s games.

According to Cutler, businesses on 82nd Avenue have been negatively impacted for years due to the bad publicity from the prostitution and the illegal activity that occurs in many of the businesses’ parking lots after hours. He also said evidence shows that three or more strip clubs and porn and lingerie shops in an area, businesses that can be found along 82nd Avenue, increase organized criminal activity.

However, Cutler is also positive about the future of the community. The Fubonn Shopping Center, the largest Asian shopping center in Oregon, is a magnet for positive impact on 82nd Avenue and bringing more locally based companies to that area will provide an encouraging model for businesses, said Cutler.

“82nd is pro-business,” Rasmussen said. “We are highly motivated, eager customers, waiting for businesses to set up.”

President Tim Boyle stated, “We believe Columbia Sportswear has tremendous long-term growth opportunities.  However, our recently announced 11 percent decline in orders for spring 2009 and our expectation that U.S. market conditions will remain challenging through 2009, make it necessary for us to better align our planned spending with those realities.  We have approached this decision thoughtfully to ensure that we are able to continue investing in our expanding retail store platform and increased marketing.  Although difficult, we believe these actions will ultimately strengthen the company and position us well for when the economy recovers.”