MIAMI — Like many home owners, hotels are starting to drown in debt.

They have been enticing travelers all year with sweet deals: credits for in-house spas and restaurants, up to 50 percent off five-star rooms, even free nights.

But all that discounting hasn't stopped occupancy from dropping an average of 10 percent. The result? Hotel loans have begun falling into delinquency faster than any other kind of commercial real estate debt.

The rising defaults paint a grim picture for an industry with increasingly more rooms than guests, and more hotels still opening every day. It's a problem that could get worse before it gets better, with demand expected to remain weak and ambitious new projects planned before the meltdown worsening the room glut.

The oversupply means room rates should stay low for at least another year, good news for consumers but not so great for hotel owners and the banks that lent them the cash to build or buy.

The rise in delinquencies is sharp. Five times more hotel loans are behind on payments this year than in 2008, according to mortgage data firm Trepp LLC, which tracks those traded by investors. In October, 8.7 percent were distressed, compared with 1.5 percent last year.

That's almost double the 4.8 percent rate for commercial property and the 4.5 percent rate for stores.

"Right now is an absolutely horrible time to be in the hotel business," said Ben Thypin, senior market analyst for market research firm Real Capital Analytics.

What happens when a hotel loan goes bad? Banks are much less willing to seize them than houses because running a hotel requires know-how. But some hotel owners are just handing back the keys where property values have plummeted.

In most cases, it is investment funds falling behind on payments, not major hotel companies. They generally don't own much property, instead franchising brands and earning a percentage of sales.

Most of the 1,231 U.S. hotels and casinos with troubled financing are remaining open. So, in the short term at least, consumers can expect to see deals on room rates for at least another year. Executives at STR Global, the hotel research firm, expect demand to rise 1.6 percent in 2010, but average rates to drop 3.4 percent.

Not in the 20 years the firm has collected hotel data has supply and demand been so far apart – not even in the early 1990s recession or after Sept. 11, 2001.

In July, even the posh California resort where American International Group employees vacationed after the company got bailout funds – inciting a wave of populist rancor – was taken over by a lender. Franchisor Starwood Hotels & Resorts Worldwide Inc. is still operating the St. Regis Monarch Beach, but such upscale resorts are still struggling without Wall Street business.

Extended Stay Hotels LLC filed for Chapter 11 bankruptcy protection in June, with $7.6 billion in debt across 681 residence hotels that also depend on business travelers. And Red Roof Inn Inc. defaulted in June on $361.4 million in loans on 131 properties.

Most of the distressed debt is on new or newly renovated high-end resorts built from 2005 to 2007 on dreams of corporate meetings and cocktail hours. Luxury projects approved before the recession are still opening this year and in 2010 – including three Ritz-Carltons.

And even more new hotels are on the way. Because outside investors have to secure the loans and take the biggest risk, hotel chains intend to keep growing – even at the high end.

Starwood is adding 45 luxury and upscale hotels to its U.S. portfolio this year, and about 23 in 2010. InterContinental Hotels and Resorts is signing a contract every day to add to its more than 4,300 properties, the world's largest by room count, said Jim Abrahamson, the British company's leader in the Americas. This year, 335 of the company's new hotels are in the U.S.

Starwood CEO Frits van Paasschen brushes off critics, saying "rumors of luxury's demise are greatly exaggerated."

"As you look back on the excesses of the 1980s, 'The Bonfire of the Vanities,' the run-up in prosperity around the Internet boom – even going to Pompeii and seeing the way people were being pampered 2,000 years ago," he said. "I think luxury, taking care of yourself, taking care of your family and those around you is so fundamental to the human experience."

This week President Obama will convene a Jobs Summit to build support for new initiatives aimed at ensuring workers are not left out of the economic recovery. This could be a historic event, but only if it is more than a one-time meeting and serves as the starting point for getting business, labor, and government leaders to work together to create good paying jobs.

Current data on jobs and wages show why workers rightly feel they are being left out of the economic recovery. Unemployment is at a quarter century high and the Congressional Budget Office predicts that unless stronger actions are taken unemployment will remain above 10% in 2010, 9% in 2011, and 7% in 2012. This means that between 15 to 20% of the nation's human capital will remain unemployed, underemployed, or out of the labor force for the next three years--clearly an unacceptable outcome that will further delay and weaken economic recovery. The wage data are equally unacceptable. Average worker incomes have been flat or fell during the recession. Nor did they grow over the seven years of the past economic recovery. Indeed workers have been getting a declining share of the productivity they helped create (most of it went to those in the top one percent of the income distribution) for the past three decades. Unless more direct action is taken the earning power of existing and new jobs will remain stuck at the same levels they have been at for many years. Given that consumption accounts for 70% of the economy, a wage-less recovery translates to a weak and unsustainable recovery.

A number of ideas for job creation have been proposed. Among them include a work sharing proposal that would provide unemployment benefits for reduced hours of work, an employer tax credit for creating new jobs, use of TARP funds to provide credit for small business, additional stimulus funds for local and state governments, and expanded investments in infrastructure and construction. All these proposals are worth considering. None alone is a silver bullet. The mix of options chosen will have to produce nearly 8 million jobs just to make up for those lost since the beginning of the recession.

Getting wages moving again will require a new social contract between labor and business to replace the one that has been broken since the 1980s. The President should call on workers and their unions and associations to work in partnership with employers receiving taxpayer funds to build the high performance workplaces and work processes needed to generate high productivity and high service quality. Evidence from manufacturing, healthcare, and other industries shows that major financial and/or technological investments only pay off in high productivity when matched with state of the art workplace practices and cooperative labor management relationships. In return, employers receiving funds should be expected to follow compensation principles that share equitably the gains generated from productivity and economic growth.

Implementing this new social contract will require business and labor to work together in ways they have been unwilling to do for many years. The sad reality is that they have been locked in an ideological stalemate over the legitimacy of unions and over how to fix and modernize a failed and outdated labor law. The President needs to use this historic opportunity to break this impasse and launch an era of productive and innovative labor management relations needed to foster and sustain the new pact.

To do so, the President should announce his intention to work for speedy passage of a reframed and expanded Employee Free Choice Act, a labor law reform bill currently stalled in Congress. The reframing would state the objectives of the Act are both to restore workers' ability to join a union and gain access to collective bargaining and to transform labor management relations in ways that get wages once again growing in tandem with productivity and economic growth. Provisions should be added to the bill to create an on-going national labor management advisory council to oversee implementation of the new law and provide advice on how to promote and diffuse productive, innovative, and cooperative labor management relations.

This national body should be supplemented by industry-specific councils where taxpayer dollars are being invested such as health care, infrastructure, aviation, and renewable energy. Industry management and labor experts should be held accountable for making sure the right mix of high performance and compensation practices get implemented.

Likewise, local level labor, business, community, and government leaders need to work together to translate stimulus funds for infrastructure repair, weatherization, and green jobs into projects that are completed on time, on budget, safely and that generate new job and career building opportunities for women and underrepresented minorities. There is much talk about creating broad-based green jobs coalitions at the local level but to date they have been slow in materializing and, as a result, job creation has been equally slow. Active facilitation of multi-stakeholder negotiations will be needed to accelerate the pace of job creation.

If it is a first step rather than a one-time event, the Jobs Summit will be recorded as a historic achievement--the day a new social contract was put in place for workers and families to share in the economic recovery they help produce and the day the foundation was laid for creating good sustainable jobs and 21st century labor management relationships.

More on Careers

I will make a rather bold proposition. President Obama understands how to work with the Chinese government better than any recent US President.

Facing a barrage of criticism on his return from his recent Asia tour, President Obama saw supporters and critics alike lambast him for his visit to China, with CNN's David Gergen calling it the worst presidential visit abroad since Kennedy met Khrushchev in Vienna in 1961. This refrain was picked up by both ends of the media spectrum. John Bolton, the former UN ambassador, despairingly sees Obama as being 'unable or unwilling to defend U.S. interests strongly and effectively'.

These views are understandable but narrow-minded. Let us first view where Obama did genuinely fail, the appreciation of the yuan. The common media and popular perception now recognises China as a global player, with a powerful economy and a strong political influence, but has failed to grasp the change in policy this automatically represents. It is true that the Chinese government has been very happy to let the value of the yuan remain pegged to the dollar alongside the euro and yen. This has allowed Chinese exports to remain at rock-bottom prices to the horror of countries like South Korea or Brazil. Obama did not secure any clear achievements in this regard. In this, Obama showed his naivete. If China is now a global player, with the strongest economic performance of the financial crisis, why should it listen to economic demands from any other nation? Let us imagine the furore if Obama had been expected to adhere to financial demands from Hu Jintao. Given China's position as the main holder of US foreign debt, this furore may well soon come to pass.

However, in his other two objectives in China namely climate change and denuclearisation, Obama scored high points. On climate change, expectations had hit rock bottom when in Singapore, Obama announced efforts to seal a long-term deal at Copenhagen had come to a halt. But, as pointed out by Vanity Fair, China and the US would both commit to long-term emission reductions thanks in large part to a back-channel effort between US and Chinese officials begun long before Obama's trip to Asia. Lest the importance of this occasion go unnoticed, this is the first time that the two worst carbon-emitting nations have made such commitments. Why then was this not shouted to the heavens? Why was a gleeful Robert Gibbs not tap-dancing his way to the press room? Because this administration and this president understand a key aspect to Chinese culture.

Face, or lian in Mandarin, that concept of honour and pride that governs so much of business in China has been key to Obama's success. Going back to President Nixon, US presidents have railed against human rights, the horrific treatment of Tibetans and Uyghurs and freedom of expression. These issues are an absolute shame upon China's governing elite and must be dealt with vigorously but such direct criticism from US Presidents achieves little apart from making political hay on Capitol Hill. By instructing his diplomats to work with their Chinese counterparts under the radar, Obama achieved three things: signalling to the Chinese government that there would be a new way of doing business, allowing the Chinese government to save face and closing commitments on climate change and the Iranian nuclear problem.

This week, very shortly after Obama returned to the US, China and Russia agreed for the first time in four years supported a US-led resolution denouncing Iran's nuclear program. This should quell any fears that Obama's criticised soft approach to diplomacy bears no fruit.

This understanding of face has been evident since Obama took office. This is a president who bows to the King of Saudi Arabia and to the Emperor of Japan, who begins with a speech in Cairo with the greeting 'Asalaam 'Alaykum', because he understands that while Fox News froths about Anti-Americanism, such gestures of respect can change the world.

More on Barack Obama

CHICAGO — Former NBA All-Star Antoine Walker is apologizing for "unacceptable" living conditions at Chicago buildings owned by his companies.

Walker told the Chicago Tribune he wants to "humbly apologize" to everyone who's been affected by the failings of his companies, Walker Ventures LLC and AW Realty LLC.

One building has been described as a slum nuisance by the city. A broken sewer pipe filled the basement with feces and debris, and bricks tumbled from the building's facade.

Over a dozen lawsuits have been filed against Walker's companies over poor management and unpaid debts.

Walker is also facing criminal charges over gambling debts to three Las Vegas casinos.

Walker played for Boston, Dallas, Atlanta, Miami and Minnesota during his 12-year career.

More on NBA

GAINESVILLE, Fla. — Tim Tebow's eye black is waterproof.

His perfect season is starting to look shatterproof.

Tebow accounted for five touchdowns in his home finale, a triumphant farewell that included tears on the field and in the stands, and top-ranked Florida thumped rival Florida State 37-10 Saturday for its sixth consecutive victory in the series.

"I don't want to say goodbye," coach Urban Meyer said. "The good thing is we're not done. The negative is we're done in this great stadium."

The Gators stayed unbeaten heading into next week's Southeastern Conference showdown against No. 2 Alabama, extended the nation's longest winning streak to 22 games and improved to 12-0 for just the second time in school.

Tebow may have even secured a third consecutive trip to New York for the Heisman Trophy presentation. He gets one more chance to impress on the big stage next week in Atlanta against the Crimson Tide with a trip to the national championship game on the line.

The Seminoles (6-6) lost for the second time in six games, and longtime coach Bobby Bowden's likely finale at Florida Field showed exactly why some FSU faithful are urging him to retire: Florida outplayed its in-state rival at every position.

Bowden said he has some "soul-searching" to do before making a decision about his future at Florida State.

"I want to coach next year, but let me say I want to go home and do some soul-searching," said Bowden, who has 388 career victories, second most in major college football. "I've got to run this thing through my mind a few times."

It might be hard to keep images of Tebow embarrassing his defense again out of those thoughts. Tebow completed 17 of 21 passes for 221 yards. He also ran 15 times for 90 yards against a defense that might be Bowden's worst in 34 seasons.

It was hardly a surprise considering Tebow torched the 'Noles the previous two years, totaling eight TDs in those. This one could have been even more lopsided than the 45-12 drubbing in 2007 and the 45-15 beatdown last year. But Meyer pulled many of his defensive starters late in the third quarter.

The Seminoles trailed 30-0 before Bowden opted for a field goal on fourth-and-goal from the 2 on the final play of the third. They added a touchdown with 6:03 remaining to make it 37-10.

"They have solid players at every position, very fast, very strong, they're good," said FSU quarterback EJ Manuel, who threw two interceptions and was sacked three times. "We'll get to that level one day. Our energy level wasn't high enough to match their energy level. They're a high energy team."

Manuel's TD pass to Jarmon Fortson was the team's only cause for celebration on a day that belonged to Tebow, linebacker Brandon Spikes and their fellow seniors who have more wins (47) than any other class in SEC history. They also improved to 12-1 against their four traditional rivals – Tennessee (4-0), Georgia (3-1), Florida State (4-0) and Miami (1-0).

The revelry started with Tebow making his final walk into The Swamp amid 90,000-plus fans screaming his name. Tebow and Meyer embraced at the 30-yard line as tears flowed down Tebow's cheeks. Spikes kissed the ground as he was introduced. Receiver Riley Cooper was wearing eye black – much like many others in attendance.

Fans paid tribute to Tebow, the 2007 Heisman Trophy winner, by wearing his famed eye black patches. Meyer's wife and two daughters also donned the little ovals under their eyes.

"That was special," Tebow said.

So was the rest of his day.

He had two TD passes to Aaron Hernandez and another to Cooper, his roommate. Tebow scored on an 18-yard run in the second, then added the 56th rushing TD of his career early in the fourth. The stadium was lit up by camera flashes as he zipped across the goal line.

It capped his best performance of the season. Tebow left the game to a long, standing ovation after the first play of Florida's next possession.

"I was so happy for him," cornerback Joe Haden said. "Tebow's probably one of the best college football players ever to play the game. All the credit he gets, I still don't think it's enough still for all he does for the team and all he does for everybody. He's way more than a football player."

When it was over, Tebow jogged to midfield to shake hands with Seminoles defensive coordinator Mickey Andrews and Bowden. He sang Florida's alma mater with teammates and then started his final victory lap. It seemed to take forever. He was soaking it all it.

"Just saying thank you to all the fans and not get too emotional about it," Tebow said. "My relationship with the fans is great. One reason is 'cause I'm such a passionate Gator fan. I care so much about this university and this team because I'm such a big fan. They know I appreciate them."

Tebow handed out high-fives, handshakes and hugs. He came across several crying faces, telling one girl, "It's OK. I'll be around."

He also stepped on a cheerleader.

"She went down hard," he said. "I felt terrible, so I gave her a big hug. She was a little embarrassed. I felt bad about that. They were all laughing, so I think she's OK."

Many of Tebow's teammates came out of the locker and danced around the "F" at midfield as he worked his way around the stadium. Tebow finally caught up with them back inside, just in time to join the seniors in sharing a few words in front of the team.

"Jermaine Cunningham probably said it best. He put both arms up and said, 'I'm living a dream,'" Meyer said.

The Gators are two wins from a third national championship in four years. They have more celebrations planned, and they could be better than this one – even for Tebow.

"It's been a long day," he said. "I was telling (Cooper), 'Man, it seems like everything's in slow motion, which is good because you want to remember everything."

More on College Football

A Robust economic recovery in 2010 is certainly on most investors' wish lists as this year draws to a close. A return to prosperity would not only mean an end to our long financial nightmare, but it would also buttress a rebounding stock market, one of 2009's few bright spots.
S
The news out of Dubai late last week, however -- that its investment company is struggling to meet repayments on some of its $59 billion in debt -- reminds us that we are far from finished with a ferocious deleveraging process...

More on Financial Crisis

ABU DHABI (Reuters) - Abu Dhabi, wealthy capital of the United Arab Emirates, will "pick and choose" how to assist debt-laden neighbor Dubai, a senior official said on Saturday, after fears of a Dubai default sent global markets reeling.

More on Dubai

Why is "Banks Giving" a headline we never expect to read? And isn't it time we acted in unison to do something about that?

Like you, I've grown increasingly uneasy about the money financial institutions are making. And the obscene bonuses paid to senior people (you can be sure that tellers aren't in line for such excess).

I've been wondering what the average person can do - in addition to sending clear messages to our leaders. An interesting story out of Australia (written by Keith Bradsher of the New York Times) shows the power of activism. After years of complaints by small business (retailers and restaurants), banks and credit card companies reduced merchant fees. The story also shows the limits. As fast as regulators came up with restrictions, banks came up with new fees. It's a vicious (and I do mean vicious) circle.

I started thinking about all of this in New Radical terms. Instead of waiting for someone else to solve the world's problems, New Radicals say, "I can do it!". And they come up with positive, constructive, and hopeful approaches. So, if straightforward activism (viz Australia) has its limits, what else can we do?

Can we get off the financial grid altogether?

I'm not talking about the proverbial mattress or even local trading coupons. I'm looking for ideas that work in our 21st century world. I want to hear about smart, sustainable financial alternatives. Has anyone started a "good" bank - and, if so, why haven't we all heard about it? What other options are out there, or in the works? I've been writing about "good" venture capitalists, including the SOCAP conference last September in San Francisco (which was attended by every major financial institution - they know something's up). What about day-to-day banking? Mortgages? Credit cards?

What are you doing? What have you heard about? How can a new breed of financial institution help bring our ailing world back to full health? How might we encourage the banks of today to start thinking like the banks of tomorrow? How can we help them see that we exist not only for ourselves but also for each other? Because, well, that's what this holiday season is all about.

Please share your thoughts by commenting below. As always, I invite you to email me at JULIA (familiar symbol) wearethenewradicals (symbol) (COM).

Julia Moulden is on tour, talking about the New Radicals. She doesn't leave home without them.

More on Financial Crisis

The Dow Jones industrial average closes down 154 points, a slight recovery from earlier losses. World markets react strongly to Dubai's announcement that it would freeze its debt repayments.

Stock markets sank in the U.S. and Asia on Friday as investors scrambled to determine whether a debt crisis in the Middle Eastern emirate of Dubai would infect credit markets around the globe.

The nation's shoppers took advantage of deals on toys and TVs with some renewed vigor in stores and online on Black Friday after a year of concentrating their spending on basic necessities.

Though the first numbers won't be available until Saturday, early reports indicated bigger crowds than last year, with people buying more and even throwing in some items for themselves.

It was an encouraging sign for retailers, which have suffered through a year of sales declines, and perhaps also for the broader economy, which could use a kickstart from consumer spending.

In Chicago, Dan Montgomery and his wife carted bulging Macy's bags, proclaiming the department stores had "killer deals." Their favorite buy? A set of two skillets for $19.99, marked down from $100.

Still, mall operators said more shoppers were sticking to making purchases in cash and debit cards instead of credit. "I like cash because when you're out of cash, you're out of cash. And you don't have the hangover in January," Montgomery said.

Worries about jobs clearly were on shoppers' minds. Most people buying for themselves were picking up practical things that were deeply discounted such as pillows, pajamas and coffee makers, according to stores and analysts.

"With the layoff there have been a few cutbacks, but with the great sales they're offering this year, I think it's, overall, going to be a great Christmas for my two granddaughters," said Ernest Bell of Marietta, Ga., who was laid off in April from his job as an information technology support representative and was at the local Walmart on Friday.

The nation's retailers ushered in the traditional start of the holiday shopping season with expanded hours and deep discounts in hopes of getting people to spend.

Online, Walmart.com, Amazon.com and other online retailers also grabbed for a piece of the action, pushing deals on Thursday and even earlier in the week. Several large retailers, including Walmart and many Old Navy locations, even opened on Thanksgiving.

Those stores now have to figure out how to keep people coming back through Dec. 25.

Though there were isolated reports of squabbles, the pre-dawn crowds were generally calm. Stores took extra precautions to control the throngs after a Walmart worker on Long Island was trampled to death last year on Black Friday.

Analysts monitoring the malls said shoppers were less frenetic, having researched deals before going shopping. Extended hours also gave shoppers more time to grab deals both online and in stores than a year ago. Most Walmart stores were open on Thanksgiving to prevent the mad dash of shoppers for its Friday 5 a.m. specials.

ShopLocal, a subsidiary of publisher Gannett Co., on Friday said traffic was up 27 percent at top retailers' online sites featuring their Black Friday ads.

Stores were encouraged that shoppers appeared to be a little freer with their spending. Best Buy, Sears Holdings Corp. and Mall of America, as well as mall operators Taubman Centers and Simon Property Group, offered signs people were buying more than last year.

An average of about 1,000 people were in line for midnight openings at Toys R Us stores, CEO Gerald Storch said. After setting aside 100 Zhu Zhu Pets hamsters for each location, Toys R Us came back with several shipments of the hot toy for several of its stores Friday.

Even luxury stores, which generally aren't the big attractions for Black Friday, had brisk traffic, according to analysts.

More than 5,000 people were at Macy's Herald Square store in New York early Friday, slightly more than last year, Macy's CEO Terry J. Lundgren said. Among the most popular items were Tommy Hilfiger $99 bomber jackets, marked down from $450.

Dondrae May, a manager at a Best Buy in Framingham, Mass., said shoppers started lining up at 4 p.m. Thursday – 13 hours before opening. He said shoppers were filling their baskets with more items than a year ago, when they were shellshocked after the financial meltdown. The biggest draws were laptops, TVs and GPS systems, he said.

The chain had sold out of all of its early morning specials within two hours of the 5 a.m. opening, spokesman Scott Morris said.

While Black Friday is not a bellwether for the season, analysts are studying Friday's receipts to better understand the mindset of shoppers like Laura Frankito, a nurse who found herself at Kohl's outside Cleveland buying a Snuggie blanket-robe for her aunt and Tony Hawk T-shirts for her nephew.

She's only giving money to her two children, and she pointed out her newfound practicality by saying she wouldn't get a $12.99 canine version of the Snuggie for her sister's dog.

"There would have been a year when I would have gotten that," she said.

___

Associated Press Writer Lisa Cornwell in Cincinnati, AP Writer Kate Brumback in Atlanta and AP Retail Writers Betsy Vereckey and Mae Anderson in New York City, Ashley Heher in Chicago, Emily Fredrix in Cleveland, and Vinnee Tong in San Francisco contributed to this report.

(This version CORRECTS to "Simon Property Group" instead of "Simon Properties.")

More on Holiday Sales