Economic things I learned or overheard this Memorial Day

( – promoted by buhdydharma )

(The following was cross posted from Economic Populist and Venomopolis.)

I’m a sucker for barbecues, especially good ones.  Normally I’m not a “family” person, but I am a people person.  When it comes to barbecues, though I tend to even go to the ones my family puts out.  This year I hosted, unfortunately the weather was not on my side and being someone into risk management I decided to hold an “indoor bbq.”  The food, as always, was good, but my other type of appetite was also satisfied, my hunger for news and tid bits

Many years ago,  I read a few books by Peter Lynch, one called “Learn to Earn” and the other “One Up on Wall Street.”  Now Lynch was one of those guys that could pick a stock and make money, but in my opinion he was one of those money managers in an era where really everyone was making money.  He’s one of those proponents of “buy and hold” which today has been proven to be bunk for the most part.  Anyways besides learning how to read a company’s financials, his other main pony trick was to utilize “outside forces” for research, that is taking notice of things.  For example, if you’re kids or their friends all seem to be wearing the same Chinese-made sneaker, maybe you should look into that company to invest.  Well one derivative of that which I adopted was to listen to people and pay attention.

Yes, I watch the news, but sometimes you can pick up something just on hearing a friend who is an expert on something or he or she is one of those “tells” on the economy.  This gets me to my first thing I learned this weekend, the consumer is more worse off than even the news is saying.  My cousin Will is a shopper, I mean he’s like the last of the big spenders regardless if he’s got the money or not, we’re talking the types that predatory credit cards love.  His credit is shot, yet he still could get a card.  I say could instead of can because as of now, all he gets are rejection letters. His biggest binge is on clothing, he is (as he says) the “Shopping Queen.”  Now I’m a plain man, not a great dresser, working jeans and good shoes I’m happy.  Not him, name brand this or that, I even seen him spend $300 on a pair of jeans.

Well ok, so what the hell does this have to do with anything?  Ok, we get it, he wastes money, why are you wasting or printing this?  Because today he told me he’s gotten into mending his old clothes!  And by mending, I mean he actually went into a pawn shop and purchased a sowing machine and whatever else you need.  He went on to say how since he literally cannot afford even pants from Target (Where he works), that he’s gone to finding whatever he hasn’t thrown out (which he used to do almost every few months to refill his closet) and making them last.  I have to say, he seems pretty good at it.  He showed me all the spots he fixed and that.  I asked him where he learned to sow and then he dropped another bomb.  His friend, another shopaholic took it up when he fell into financial disrepair.  It seems his whole circle just stopped shopping and going on to making their clothes last.

This mending business isn’t just clothing, folks.  Two friends, one an accountant who was laid off, said he returned his year old Toyota and is keeping his Chevy he let his wife use.  It’s now the “family car,” meaning sharing and such.  Now this thing has got to be 7 years old.  But he said no matter what, he isn’t going to into hock to buy another new car.  That they will keep this going for at least another 7 years.  This was echoed by another family member, who was looking to buy a car but was afraid to.  They all hear from people saying the same thing.

Homes, not really a surprise here.  I would say that a third who attended my indoor bbq shindig are going to lose their home.  They didn’t come up and say it, but you know how when someone talks and wants to say something but doesn’t come out and say it but you get the idea?  Like that.  Damn shame too, because we’re talking small families and in one case pets too. I had 4 who were trying to sell who just gave up and took their homes off the market.  Half are in industries where there is a shakeout going.  Instead of selling, most who believe are going to stay in their homes are now doing for their homes what they are for their cars.  Trying to keep it up, fixing a pipe here, adding something affordable like a new sink.  One friend of ours who live in Lake in the Hills was telling us how a lot of the fancy homes out there are quietly becoming empty.  I’m curious and going to have to get out there, they got some BIG homes over there.

Another thing I learned is that the job market is a lot worse than the media is saying it is.  Of course, we here at EP have known this for a while.  9% my ass!  A lot of my friends who worked in the service or retail sector had their hours cut.  My cousin, Will, the shopaholic, had his hours paired down from 30/week to less than 10.  Several others were given a choice of less hours or being laid off.  You know, the level of underemployment in this country I think has to be the highest since the Great Depression.  I bet if you added it to what we all think unemployment should be, the overall figure would be at least 20%. And this has an impact on the economy, folks aren’t going to spend if they think they won’t be working as much or at all.

The last thing I learned, despite the graphs and studies, most aren’t saving like they should  We keep hearing how Americans are once again approaching 10% savings rate.  If my informal unscientific poll/inquiry is any sign, I would say we’ve gone from a minus figure to perhaps 4-5%.  Most are now plowing what they can to pay off their credit cards.  What they can save, gets quickly eaten up by rising gas and food prices. Not to mention taxes, here in Cook County, we have 10.25% sales tax.  The City of Chicago has a score of fees and taxes as well, all of this eats up folk’s salaries and savings.  My aunt actually said she plans on trying to find cereal online to avoid buying it in Chicago.  It isn’t easy for her to get out to the burbs, she’s all the way on Sheridan by the lake, got in there when it was cheap back in the day.  She says how seniors are having it tough, “you just can’t save, you try but you can’t! Having a bitch of a time doing it!” she goes on.  I think those words could actually go for a lot of things I learned.  Folks are trying to survive, but can’t or having a bitch of a time doing it.


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  1. Thanks for reading my latest article, it’s been a while, haven’t been doing good health wise.  Now I’m back, baby!  I missed you all and it’s good to be “home.”  

    Anyways, once more, thanks for reading this.  I know they are saying the economy is “improving,” but sometimes you need (to paraphrase Howard Zinn) to hear the common person tell it.  Often you’ll get more of the truth from the working person than you will those television talking heads.  It’s tough out there, and I truly hope for the best for you all.  Keep up the good fight!

  2. … 16.2% raw.

    Table A-12. Alternative measures of labor underutilization

    The modern equivalent of hobos are 1/4 time workers, trapped in one place because they cannot afford to go elsewhere to look for work. Just look on that unsellable house as a nice roomy boxcar.

  3. for over a decade.  I’ve passed it many times when parents were waiting out front to pick their kids up from the school bus after school.  Lately, I’ve been surprised at how many men there are waiting out there for their kids.  I would assume many are not working.  Definitely a change from years past.  

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