Well, Duh…Let's see – The President and Vice President told the country that times are the worst ever and are going to get even worse. Every news cast and headline is screaming that the economic world is coming to an end. No one in the government, wall street, academia, or wherever, has one positive thing to say. And if someone does, guess what, no one is told about it. No wonder people are holding back – they have money, they just don't want to spend it.
Look out your damn window. How is YOUR business doing? We are doing fine. I spoke to an accountant in Florida who can't figure out what all the screaming is about. He says the restaurants are full, the supermarkets teeming, movie theaters are full. I find the same thing here in California. The guy who cuts my hair, a fairly good barometer, says that he can't understand it, but business is good. (Marcy thinks I pay too much to have my hair cut).
Of course, people are tentative. And why not? All they hear is doom and gloom. It has become a self fulfilling prophecy. Some say the 'recession' will be over in April, others Midyear, still others say the earth as we know it has ended.
Balderdash. Housing is selling faster than the banks can fill out the paperwork. Why? Because the price is now down to where people can afford them so people are buying. Makes sense. The free market did what the government couldn't. It has made housing affordable for people who couldn't afford it before. I would suggest that housing prices are pretty close to have bottomed out. Maybe a schoch lower but that's about it. Then they will begin to climb again.
Many companies overextended during the past six years of boom time. Now they have to reset a bit. Those that are cutting are cutting about 10% or so of their work force. We shutter that Citibank cut 25,000 people, but that's about 10%. They had grown too big too fast. Notice how a company's stock goes up just after they announce layoffs. That's because the market knew they were too big.
Auto Companies? What a laugh. Did you know that GM sells 9,000,000 cars but builds or has the capacity to build 12.000.000? I know a guy in Pennsylvania who has an off airport location next to a car lot where GM stores thousands of cars that it built but will never sell. Why do they build them? They have to, the union says so.
Sorry, just venting. More later
JVH
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