Tuesday, August 08, 2006

Interesting Article

This piece in CityBusiness gets back to aviation as a source of recovery. In thinking about how to grow the economic base, one thing that is certain is that big investments ($100 million or more) are very unlikely unless they are inherently floodproof. That means no sprawling automotive plant or warehouse facility in NOBID.

With aviation, however, like the port, the assets are mobile. So, if we need to increase the capital base of the local economy by $2-6 billion to greatly improve employment prospects, we might find that a lot of $30 million airliners, and $30 million movies are lower hanging fruit than a $2 Billion plant or three.

With that said, buying a bankrupt airline with the state's credit rating is probably a longshot. As noted in a prior post, the finances of the State are counter cyclical with the airline industry. Helping them locate in LA is probably a better mix of complementary strengths and weaknessess. Buying them, that's another story.

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