Trickle-down effect turns upside down

By Robin Urevich

Thursday, July 3, 2008 | 2 a.m.

Attorney Shawn Christopher saw the economy turn about 18 months ago when his clients stopped asking how to manage piles of money and began seeking help with mountains of debt.

On Eastern Avenue, motorists passing Steve Cuccio’s Chevron station hurl insults at him as he raises the gas prices on his signboard.

John Powell specialized in handling fine art, antiques and pianos when he started his Red Carpet Moving company 2 1/2 years ago. Now he’s an expert in moving furniture out of foreclosed homes.

Lisa O’Keefe stocks up on dollar loaves of bread at the Oroweat outlet store on Wigwam Parkway, not because she and her husband can’t afford grocery store prices but, well, these are times to save money wherever you can.

Christopher, Cuccio, Powell and O’Keefe stand on the fault line of the economic earthquake that’s rumbling through Clark County and shaking nearly everyone with its high fuel prices, a housing bust and growing unemployment.

The worsening economy — UNLV economics analyst Keith Schwer says Las Vegas is in a recession — is apparent all around us, not just in the financial indicators such as housing sales and unemployment figures, but in how we look for ways to make a buck, or save a buck.

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Every two months, auctioneer Jim O’Brien leads treasure hunters around the county in search of cut-rate fortunes in abandoned storage lockers. There are lots of pickings these days, the trappings of an economy gone bad.

Some people who bought more house than they could afford because of easy credit several years ago are moving into smaller places — and stowing many of their belongings in storage lockers.

They think they’ll bounce back economically, said Greg Welsh, who manages 40 Storage One facilities in the Las Vegas area. But, Welsh said, some never do. “They’re taking off. They’re going to other states, moving in with Mom and Dad.”

When they stop paying their storage bills, the storage company takes possession and calls in O’Brien. He auctions off what’s left behind.

O’Brien’s business is booming.

“When times are bad, I do good,” O’Brien said. He pockets a percentage of the proceeds from each auction, with a guaranteed minimum.

During flush economic times, O’Brien makes $30,000 to $40,000 a year. This year he expects to earn double that or more.

Some storage lockers yield real value, said Henderson retiree Mark Norton, a regular at auctions. He recently watched someone pay $3,100 for a unit full of tools and a new refrigerator that Norton surmises was abandoned by a construction contractor gone bust.

On a recent afternoon, O’Brien — wielding a circular saw to slice through padlocks — led about 20 prospectors down a long narrow hallway in search of A114.

The roll-up door wasn’t even locked. Behind it: a beat-up entertainment center, a lamp and a dinette set.

O’Brien started the bidding at $25, chanting in the staccato cadence familiar at a county fair. The bidding goes down, not up. “$25, $23, somebody say $10. Sold $10.”

The buyer owns a secondhand store in Pahrump. She promises that when she sells the stuff to her customers, it will still be at bargain prices.

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At North Las Vegas’ Bargain Pawn, nearly every transaction has a back story: Someone is struggling through hard times. Lately the shop has been seeing a rush of middle-class customers. A lot of them seem to have jobs in real estate and auto sales, manager David Bramlett said.

Customers say they’re facing foreclosure, no longer have credit cards and need cash. That’s where Bramlett’s pawnshop comes in. They hock jewelry, electronics, guns.

“They bluntly tell us, I never had to pawn anything in my life and here I am.”

Many customers come back later to redeem their belongings. Some return week after week, treating the pawnshop like a credit card.

Bramlett empathizes. He’s a refugee from bad economic times. He’s back at the shop, which has been in his family for more than 20 years, after a five-year stint with a real estate developer gone bust.

He can put food on the table in the pawn business but says that despite the brisk trade, the shop isn’t making much money because sales are down and demand for loans is so high that the shop is tapping its own lines of credit to keep from turning business away.

But slower sales mean that store clerks have to be a bit more selective about what they’ll take.

Those looking to shed their dentures or oxygen tanks need not apply — they’ve been rejected before.

But gold teeth are more than welcome. Gold prices usually rise when inflation is up and the dollar is down, and prices are spiking at more than $900 an ounce. Bramlett said that every month, the store delivers a small mountain of unclaimed coins, jewelry and even a tooth or two to a gold refinery to be melted down in exchange for $12,000 to $15,000 in cash.

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Carolyn Trepner-Kirson, proprietor of The Refinery Celebrity Resale, a consignment shop that offers secondhand Gucci evening wear and Jimmy Choo sandals, has seen a 40 percent drop in business over the past five years.

And now it’s worse. Storefront signs advertise brands such as Chanel, Valentino and Prada, but a few weeks ago, Trepner-Kirson hand-wrote a larger and more telling message on the front door with white shoe polish: “Sale.” She’s slashing prices.

Her customers have forsaken Armani and Prada for Target and Forever 21. She blames the economy.

Realtors and mortgage brokers who used to be regulars come in sporadically, Trepner-Kirson said.

Customers who used to purchase a purse in every color are now buying one in a neutral shade. The woman who would replenish her wardrobe every season in better times might now make due with the same outfits for one more year.

And the clothes brought in to sell? They’re a little more tired than normal.

“They’re resoling their shoes instead of buying new,” she said. “There’s no money to buy a new pair of Manolo Blahniks.”

But, there is no shortage of people who want to exchange clothes for cash.

In less than an hour on a recent weekday, three women entered the store bearing handbags, furs and armloads of sparkling evening gowns and St. John’s suits.

One of them, Donna Bennett, wanted to unload a white fur jacket and a stole that looked like mink. But as Trepner-Kirson was about to talk price she unwrapped the white fur, and it began to shed like a German shepherd in 100-degree heat. Trepner-Kirson waved off any deal.

Bennett said she had picked up the furs on the job. She cleans and changes the locks on foreclosed properties for her family business, and occasionally comes across valuable throwaways. Even though Bennett said the foreclosure cleanup business is booming, she needed extra cash for her son’s graduation party.

Gas prices, she said, are killing her.