During testimony in front of the Long Term Fiscal Stability Commission on which I sit, one gentleman predicted that July 2009 may mark the end of the “Great Recession“.  A headline in the Denver Post Sunday Business section (print edition) screams: “Optimism taking hold”…

…unless you are in Northern Colorado and have even as much as a dozen degrees of separation between you and New Frontier Bank.   According to the Greeley Tribune:

Iron Mountain is now the second domino to fall after the closure of New Frontier Bank in April, which many say artificially propped up Greeley’s economy with its liberal lending practices.

Iron Mountain, for example, owed about $6.75 million to New Frontier, now being liquidated by the Federal Deposit Insurance Corp.

‘What I’m hearing is that we’re not through the full ramifications of the New Frontier closure yet,’ said Larry Burkhardt, president of Upstate Colorado Economic Development. ‘I don’t know what else to anticipate, but I keep hearing that we’re going to see more consequences of that bank failure down the road.’

We are all hearing the same thing.  Last May I posted the following on my blog:

A land developer told me that the impending implosion of the commercial real estate market will make the recent devaluation in the residential market look like a “day at Disneyland.”

What I didn’t report (but maybe should have), is that the same land developer followed up that statement with a prediction that Iron Mountain Autoplex and John Chamberlain would be the first to go.  Even if it is someone else’s opinion, I admit to being a bit leery of naming specific businesses that may be in serious financial trouble without substantial financial data to back up the claim. Maybe it was wishful thinking — hoping it would not happen.

Not a week goes by that I don’t hear from a business owner worried about losing his or her livelihood.  That’s one of the things I hate about the bailouts.  Washington D.C. decides winners and losers, and No CO has been tagged with loser while having to pay for the bailouts of the winners.  No bailouts for small business nor community banks.  Note holders await the sale of their loans and hope the new buyers will work with them.   Some, formerly strung along by the FDIC, are now being strung along by the SBA (Small Business Administration).

Add the ugliness of NFB to Weld County’s unemployment rate of 8.6%, third highest in Colorado and a full percentage point above the state average, and optimism may be a little harder to find around here.

Funny note: In an earlier post, I predicted that the collapse of NFB would be the biggest issue of the 2010 election cycle.  I may be wrong.  I underestimated the passion of opposition to Obama Care.

This entry was posted on Sunday, August 9th, 2009 at 10:17 pm and is filed under New Frontier Bank, economy, northern Colorado. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.