Boy! Did Phil Graham get it right or what?! Whiners, indeed. But it is even worse than that. It’s Chicken Little Whiners. No, by golly, it’s Chicken Little Whiners on steroids. I’ll concede to all that the not-so-creeping socialism is a real problem, and it will decrease productivity over time. But, folks, we have not had even one quarter of contraction, despite the so-called “housing problem.” Quit whining, thank God for your blessings, and work hard.
My husband and I work a lot harder than any one in a cubicle ever did. It is real physical work and I am over 65. We bless God daily and whatever He has been faithful enough to provide is appreciated. However, what I posted is true, is happening and is being exacerbated by government inaction and wrongheaded policies. It may never happen to you, anyone you know or anyone they know and for that, I am sure you are all thankful.
I do not for one moment believe that the inflation and production numbers that appear in the headlines represent the reality that I can document by personal experience and bolster with the personal experiences of folks around the country. It is anecdotal, to be sure, but the weight of anecdote at the very least can cast a bit of doubt on the official numbers. I recall executives stating loudly that the Janesville, WI auto plant would stand for 100 years just months before it was closed. We do not heat our homes with electronic gadgets and we cannot eat clothing made in Central America. We cannot pay property taxes with firewood, garden produce or venison. Profits of multinationals earned outside the CONUS do not increase the buying power of the Americans who are our clients and customers. While I have always believed in free trade and have a lay understanding of macroeconomics,I read the foreign financial press and it does seem as though we are losing the confidence of the rest of the world, the ones we have depended upon for goods at a low price and assumption of our debts.Commercial real estate and productive businesses are being purchased from Americans at low prices by foreigners. I have been told that some of these regard American workers as just another low-wage benefit to their own rising business prosperity.
We live in an area that has had 2 severe floods in 10 months. Yesterday, we traveled through some of the hardest hit areas. It has been a month since the floods and we have had heavy rains 2-3 times since. There are what look like lakes in the middle of corn, bean and hay fields.(Think food and feed prices) Homes are still up to their foundations in water. (think loss of equity and also of property taxes)Propane tanks and septic fields are in standing water.(think homelessness) Cow pastures look as though they are bisected by rivers where no rivers exist.(think rising meat and dairy prices) Commercial buildings are abandoned. Sandbags still surround some properties. Many more late model RVs, SUVs, vans and even trucks than usual are parked by the side of the road with For Sale signs. In several communities, the businesses still in operation had homemade posters in the windows advertising local benefits for the flood victims. FEMA and insurance settlements have still not been made for many for the August 2007 floods. Large acerages of good, flat, fertile farmland is posted for sale despite the record crop prices. Some crops have been plowed under and some commercial areas had earthmoving equipment in operation trying to effect some drainage.
In affluent areas of Middleton, WI, which has seen huge property tax increases, we were amazed at the number of for sale/for rent signs. Long-established retail and service businesses that existed 4 months ago are gone and prestigious shopping areas were really slow for a Saturday. I stopped counting the number of front-yard vegetable gardens when it appeared that they are ubiquitous in areas that usually shop at Whole Foods and Trader Joe's and rarely planted anything beyond some flowers.Numerous multi-family garage sales were filled with young parents apparently shopping for kids clothing.
We stayed the course in 1987 and I was a booster of the economy who pitied those who sold at the bottom. But, we were in our late 30s/mid-40s then. Our businesses were doing well. A 15% hit in the stock market was recouped over the next few years. Just a few years later, the AMT decimated our primary markets (galleries/shops owned by the wives of wealthy professionals) by Congress and a POTUS who allowed himself to be rolled on taxes. We saw our markets, and consequently, our sales, decline by 10% a year for 3 consecutive years after a 10-year successful run with a line that was selling coast-to-coast, in Hawaii and Caribbean resorts. We went back to school and changed careers, keeping one line of merchandise so as not to have all our eggs in one basket. We have done all right in the past 15 years, as we had done in the previous 15. We were not even personally touched by the recession years under Carter. We were young, successful and affluent. Our present debt consists of a tiny home construction loan and a high mpg 2-year-old vehicle and both are affordable and will be paid off in about 30 months.We have equity, some investments and hard assets. But, this time the problems are endemic and appear to be global. Even if Congress gets the message and begins to enact policies to counter the present economic situation, we foresee another 5 years ahead that will marginalize what remains of the middle class and affects most Western countries. That is us and our customers. There is a time to be realistic and, IMO, this is such a time.
Multi-millionaires like Phil Graham are not touched by the economic realities that affect the middle classes. It is not whining nor catastrophism when Americans are responding to this present situation with every tactic available. I devoutly hope that he is correct and that your optimism is justified. I could obviously use some optimism myself about now. For the interim, we will do what we can to get through this technically-not-a-recession/slowdown. But neither Graham nor you should discount the possibility that you are simply presently on high ground while the flood waters continue to rise and that it will eventually engulf many of us. Not everyone is either slowdown, recession nor depression-proof. At any time, any industry can find their markets gone, their costs escalating and the political climate totally unhelpful to their income stream. The difference this time, IMO, is the widespread fundamental nature of the problems and the subsequent lack of safe havens for those who cannot afford the losses nor replace the income.
YMMV.
“. But, folks, we have not had even one quarter of contraction, despite the so-called “housing problem.” “
I take it that you don’t travel to California.