The Surge

I can feel it.  No, it’s not a ramping up in troop force to stamp out the Taliban, it is a ramping up of construction workers to stamp out chronic unemployment in San Diego. Our housing prices are rising fast.  Even some of the staid old bankers are coming out of their cocoons.  In fact, one small bank is trying to steal one of our deals.  This bank has decided that since no other banks make construction loans, they should.  A novel concept.  What really is novel is that they recognize two important factors: 

1) that we are in a bull market for real estate.

2) that this last titanic cleansing took out a lot of good people. 

They have decided to seek out developers and contractors of good character and good capability and ignore, or at least evaluate, credit mishaps related to the great recession.  Of course they have not missed the fact that they are the only game in town for this product and they are charging what they think is a lot and what borrowers think is a gift.  I am not sure how they plan on dealing with the regulators, but that is their problem.  Assuming they have a plan, that is one smart bank.

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