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Re: Anyone Else Starting To Fear The Economy? fayeroe

Posted by Larry Hoover on July 6, 2008, at 12:22:58 [reposted on July 6, 2008, at 13:10:45 | original URL]

In reply to Re: Anyone Else Starting To Fear The Economy? Larry Hoover, posted by fayeroe on July 6, 2008, at 11:25:58

> > I just thought of another way of saying what I'm trying to get across....
> >
> > For *most* people, the economic decisious they're facing are lifestyle decisions, not survival decisions. Buying a more fuel-efficient vehicle, hanging out at the mall/restaurant meals less often, vacationing closer to home....Not about how to feed the family, or cope with having nowhere to shelter them. Being more sensible with credit, rather than outright bankruptcy. We still pay less for food, on a percentage of total income basis, than we did in the 1920's, the 1950's, the 1980's. We're just a little spoiled.
> >
> > Lar
>
> For your first post...... Yes, consumer confidence is down, at the lowest it's been since ~1990, but consumer confidence hits a bottom *after* the economic recovery has already begun. It lags the performance of the economy itself.
>
> I beg to differ with you about consumer confidence hitting the bottom after the economic recovery has already begun. Texas is in trouble right now. I am too lazy to list everything that affects the consumer here (I live here, so am speaking from mine and my friends experiences) but it is serious now.

I didn't make up my remark. I am speaking after viewing historical trend charts. Recession always officially ends before consumer confidence rebounds. The only issue that is hard to ascertain is if this is yet the bottom in consumer confidence. Hindsight will reveal that....

> People can't afford health insurance, car insurance is way down...folks are only buying what the state requires, putting food on the table is really hard...I drove into the little mall where the food bank is, last week, and the line to the door went around a corner and out of the mall.....folks are driving ten year old cars, etc. etc.

People living a marginal existence always bear the brunt of economic downturns. I've lived that one for many years. I am talking about statistical means, not marginal effects.

> I'd like to know where all of that confidence is right now, Larry.

I reiterate, confidence is at a low ebb. I am not worried, but that is my opinion. I have faith.

> There won't be an economic recovery anytime soon. You can talk about "floating money" and such.....well, it isn't floating around people here. All of that money only makes the rich richer and the poor, poorer.

I wasn't implying windfall economic inputs. In contrast to the Great Depression, unemployment is not a significant concern. Manufacturing output is increasing. Relatively more individuals are hurting, but the average is not. The economic data are not bleak

> We still pay less for food, on a percentage of total income basis, than we did in the 1920's, the 1950's, the 1980's. We're just a little spoiled.
>
> Milk is $5 a gallon, eggs are $3 and rice is unbelievable expensive. I do not agree with you. I am much older than you and I do remember the 40s, 50s, 60s, 70s, 80s and 90s. A loaf of bread that I did pay $1.85 for is now $2.48.

Once again, I am not making up the numbers. In the 20's, the average family spent 1/3 of gross income on food. Nowadays, the average is less than 15%. Poorer people (in both eras), always paid more, proportionally.

I know it's tough for you (and others you see), and I'm not dismissing that. Local calculations (Ontario) put people into an impoverished class if >30% of gross income goes to shelter costs. I spent eight years with that expense at 70-110% of income. Trust me, I get it. Pensioners, for example, or anyone else on a fixed income, always get hurt the most by inflation....adjustments to income flow always being made after the fact, if they happen at all.

> I ain't buying into your ideas. :-) Pat

I trust the statistical analyses, which are based on averages.

Lar

 

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poster:Larry Hoover thread:838387
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