Saturday, November 22, 2008
Economic anecdotes: What do you see in your business?
Luxury laundry products? What is the deal with the economy?
Much to the chagrin of my teenagers, I am the sort of person who wanders through life talking to strangers. Lately I have been asking people about their business and generally keeping track of anecdotes that might shed some light on the economy. Does the malaise in the financial markets reflect what is really going on in that part of the world that is not dependent on high-wage jobs on Wall Street?
So here are a few observations that do not seem to comport with the statistics:
On the other hand, it is undeniable that big ticket items -- houses, cars, large screen TVs, and so forth -- are getting crushed, at least nationally. My sense is that in this area, at least, people are still spending on things that do not add to their debt load, but are deferring anything large enough to add to that burden.
What are your observations? What does the economy look like in your area? How are the small businesses doing? Are the restaurants and malls crowded? Are cheaper gas prices stimulating small-ticket consumption?
Post your thoughts in the comments.
9 Comments:
By 
, at
Sat Nov 22, 11:32:00 AM:
My sense out here in smoggy Southern California is that a lot of folks just have the "attitude" that things are worse. Most of my friends are mid to late twenties and although they still have their jobs and by and large live the same way they did a year ago, you now hear them throw "well, the economy is so bad right now, so..." into conversations at random. When pressed, of course you find out they personally haven't been affected, but surely others are suffering terribly.
To be sure, this psychological phenomenon has real life side effects as well. People end up being more cautious which has a domino effect on everything. And it's also a convenient crutch as well! Didn't get a job? It's not because you did poorly on the interview, it's that darned pesky economy! That said, along the lines of the domino effect, I know my company is not hiring "as quickly", but it is still hiring.
As for a personal anectodes; I recently applied for a home loan from Bank of America. No issues whatsoever and the approval went through very quickly. Houses are still being built here, gas prices are plummeting and I found myself very annoyed yesterday at the grocery store surrounded by throngs of normal folk with all their children picking up food for the weekend. Life goes on....
It's all mind games! Very real side effects, but a little optimism would likely go a long way to getting things turned around.
By , at
Sat Nov 22, 12:04:00 PM:
I live in Santa Rosa, California. Some personal observations:
Traffic is lighter on the freeway through town.
I went to Home Depot a couple of weeks ago at 1 p.m. on a weekday. There were perhaps a dozen cars in the parking lot. Inside, the staff appeared to outnumber the customers.
My wife and I went out to lunch last week at our favorite Japanese restaurant. We were the only customers at 12:30 except for a couple at the sushi bar. I've never seen so few people there.
A contractor friend tells me new home construction in the area has dropped to almost nothing. He is now scrambling to get remodel jobs.
The local paper says the California unemployment rate is now 8.2%, the highest level since 1992.
On the plus side, I can now buy gasoline for under $2 a gallon at discount stations. My personal spending habits have not changed although it is unlikely I will be making any big-ticket discretionary-spending purchases in the immediate future.
By 
Chris, at
Sat Nov 22, 12:13:00 PM:
The bars here in Atlanta are as packed as ever, but my friends behind the bar tell me that more and more credit cards are being rejected and their sales numbers are down no matter the high number of bodies in the room every Friday and Saturday night.
By TigerHawk, at
Sat Nov 22, 12:14:00 PM:
There is no question that home construction has collapsed. That shows up in the national numbers, and it goes a long to explaining why Home Depot is suffering, since (I believe) local builders and tradesmen are a good part of its business.
By JPMcT, at
Sat Nov 22, 01:37:00 PM:
Richmond, Virginia
* We took in the new Bond film last night and the theater was packed...all screens, full parking lot.
* Had dinner at an upscale Sushi restaurant and had to wait for a seat.
* Best Buy parking lot about a third full last night...I remember remarking on how unusual that was.
* Going to Disney ever Thanksgiving...had no problem changing flight times for two of our party today for next Wednesday...I was amazed.
* Guitar and Music Catalogues offering no unusual discounts..I was disappointed.
* Checked the old pension plan again and heartened that it was only down about 20%...maybe there is hope yet!
TH, I agree with you...the day to day stuff is not suffering, only the big ticket items.
We are being told by the media that it will be anywhere from 1-3 years before a recovery. Glen Beck is telling everybody that it is the end of the world!
Who knows? Nobody is taking any chances.
By Nomenklatura, at
Sat Nov 22, 02:57:00 PM:
It's illusory to imagine that the Great Depression hit everyone equally. In fact it has been well described as 'a pretty OK time' for most people, as long as you had a job or other source of income'. The disparity of its impact, socially, regionally and demographically was one of its main characteristics.
The history of the Great Depression has been annexed by academics and teachers for decades as a tool they use to preach at us about the need for more government intervention (something you may notice that they are in favor of through all phases of the economic cycle). Consequently the story becomes that everybody except the wicked rich had an equally bad experience, so everybody except the wicked rich should be equally afraid of that now.
In order to understand what is happening now we need to take the blinkers off and take back our own history from the people who have been misusing it for decades, for political purposes. That will take a while. The older generation of academics are certainly going to be no help.
By , at
Sat Nov 22, 03:44:00 PM:
People were lined up outside the Verizon store in Bridgewater to pay $200 for a new Blackberry Storm.
Go figure.
By , at
Sat Nov 22, 09:27:00 PM:
Just a few random comments from flyover country (Ohio).
Similar observations regarding restaurants, movies, etc.
Some retail business is falling hard; one particular retail chain in Columbus is going bankrupt.
The part of the suburbs I live in has seen a lot of new home construction for the better part of 20 years. It has slowed to almost nothing now. A lot of homes are for sale and have been on the market for a while.
Several relatives work for the steel industry; specialty steels are doing ok, commodity steel is slowing down tremendously.
Gas is $1.66/gallon at most stations today.
Columbus typically underperforms the national economy during boom times, but outperforms the national economy in hard times, due to the state government, Ohio State university, large amount of banking (Bank One, now JPMorgan-Chase), finance and insurance (Nationwide HQ) companies based here that buffer employment swings. It is not as representative of Ohio as Cincinnati, Akron, Canton or Cleveland.
-David
By , at
Sat Nov 22, 10:27:00 PM:
My experiences in Chicago are similar.
Restaurants are busy. The manager at Keefer's Steak House says that business dropped in July-August but has picked up. A meal there is about $70.
Mid-price restaurants are also busy, not packed but busy. Again, I sense that people are going out again after a falloff in July-Aug.
Stopped at Best Buy -- the store was almost empty. Then at a local appliance giant, Abt Electronics. It was busy.
People are walking down the local shopping strip, Michigan Ave, carrying backs of purchases. I don't know if the purchases are of smaller less expensive items this year.
Condo sales suck. Housing is very slow. Don't know about car sales.
GZ
