Saturday, August 14, 2010

not good


No magic in that number. It's a lot of people that do not have jobs and the .5 is those of us that get maybe part time paying hours work a week when we formerly had a "real job".

That part of a nasty little upset some ass calls a recession. I call bullshit on that. It's a depression. The last major recession I know was early 1970s, aerospace companies were closing and gas jumped up more than two times and we had people looking for work and not finding any as employers had folded or was trying to survive as well. Then came the foreclosures. Well that was nothing like today but it did in a lot of neighborhoods close around those prime jobs that became empty buildings. My dad made his money in construction, thing like roofs, siding, dormers, new kitchens, finished basements, when money got tight for home owners that were barely working or not working he was impacted. My college was impacted by that and so on. There is never one victim, a company goes down, employees are let go, they move out or buy less, the corner store starts to go under, gas station sells
less gas price goes up, the corner store doesn't hire kids for the summer, prices go up,
the kid delivering newspapers makes less as every 5th house is now empty.

If you younger than 35 you never saw this before. Never mind the big one from 1929 that put the country in lines looking for a bread, maybe a little work too. Well boys and girls, this is it. Maybe not the bread lines, tent cities and large migrations like the great depression but look close the food pantries are working their asses off, people are buying less, or worse relying on credit. This one had the same start with false investments and investments funded by credit. Because the the ripple effect is so great many areas have suffered in housing either by loss of near by jobs or large amounts of outright foreclosure. If you have a job know all the housing in those areas is going cheap, buyers market. That pot many that were betting their house would be worth more and financed 95% or more, more investment speculation. Its where people live as they are now owning something not worth the loan amount, lenders get itchy but hey, they signed up for that. Both players know they signed up for that one and would do best to ride it out as if you wait long enough it may work out or, collapse completely. Using large amounts of credit in a down betting there is an up soon is also likely to bite back. There are no credible predictions this is short lived or we are on the upswing. We cannot call that until the history books are written.

Think about finance cost, think critically for a change.

Me it's yankee thrift, savings, dry powder and a plan B and C.