I never did give them hell. I just told the truth, and they thought it was hell.
-- Harry S Truman (1884 - 1972)
As the Monty Python players famously remarked, “No one ever expects the Spanish Inquisition.” Similarly, in the Hamptons economy, which is driven by real estate, no one ever expected the kind of financial problems like those in California and Kansas. Still fewer expect the kind of dire financial problems about to hit New York – not to mention the Hamptons.
While the current difficulties were clearly predictable several years ago, it is only now that there is a sense if dire fiscal eventualities, that will soon be upon us. Manhattan is no exception. With a predicted loss of 275,000 jobs on Wall Street; the disappearance of Investment Banks –-which was the driver of the worldwide expansion of money and credit; and virtual elimination of mortgage lending – a one to two year recession may take five years to play out. There are those who think that this country will not recover from this bout of deflation, which may turn into hyperinflation from printing all of those trillions for bailouts, until the early 2020’s.
The Spring selling season in the Hamptons has all of the earmarks of a temporary lift, which will last 3 or 4 months. Small properties, those in the $300,000 to $500,000 are starting to sell. Larger properties are sitting with no activity.
And, while there are some rentals, local businesses in the Hamptons will face stiffer competition and budget conscious tourists. The Town of Southampton may need Federal money to remain viable. The “business-as-usual” trend towards increased fines, increased taxes and harassment of New Yorkers may not be a good idea in these economic times.
The immigrant problem, which created lots of bad blood and a very negative attitude, will be solved by economics. Everyone is leaving town due to lack of work.