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Economic Evidence from Main Street

Discussion in 'Financial Cents' started by melbo, Apr 4, 2010.

  1. melbo

    melbo Hunter Gatherer Administrator Founding Member

    We keep hearing about recovery and green shoots. What do you see in this recession/depression from a Main Street perspective?

    We as a species tend to acclimate quickly to new environments and conditions. We also tend to think that now is normal and forget about what things were like before now.

    4 years ago, I scaled back in my Home building business because I could see the housing crash coming. I went from 5, 6 or 10 homes at a time to one at a time and finished out my final year as a General Contractor with only 2 homes built. I was a spec builder and did very little custom work. 95% of the other builders I'd run into at the coffee shop or lumber yard thought I was out of my mind and giving up money that was still to be made. Almost all of those that kept riding the wave and believing things would always continue to grow are flat broke now.

    I got out with a hurt paw and the others got hit by the garbage truck.

    I look around at the people I know and see the changes that have happened in the past 3-4 years and it's staggering if I keep in mind where they were before.

    My parents used to cruise the Caribbean 6-7 months of the year. They now live in one of the homes that I never sold and can't afford to pull their boat out of the water to perform some routine maintenance. They have recently finished off the basement of that home so my Uncle and family can move in. Uncle lost his job as a Drive train engineer in Detroit and rode out the 18 months of foreclosure before eviction. What a family reunion that is...

    My brother lost just about everything and is now struggling to keep afloat by buying and selling wrecked cars. He was forced to auction off 14 properties last year at a loss.

    My good friend has been unemployed after a RIF for a couple years and can't find anything in his field job-wise and has moved into his in-laws basement; twice.

    This isn't intended to be a pity party. I want to hear how things are around you and if you've seen anything out there that shows things getting worse or getting better. Have you seen families 'doubling up'? Have you seen more RIFs or layoffs at work? Have you started a business or got a new job that was working out better than 3 years ago?

    Log your anecdotal evidence here.
  2. dragonfly

    dragonfly Monkey+++

    Things are not so good....especially IF you work for someone else today...No guarantte's you'll have a payday, much less a job tomorrow...
    Even the local Police are being laid off, cutbacks are killing their response times, and crime is NOT taking a vacation!
    I can't see this "mess" getting better fast. Can you imagine being a Deputy, and only scheduled to work 30 hours a week? Can't pay the bills on that!
    Local stores have laid off people and cut the rest of the employees so badly, no one dares to take a vacation, or ask for a day off even for a wedding or anything else. I have 2 nephews (maybe all 3 soon) moving back in with my sister, all have lost their jobs, 2 have small children. I actually Saw the gas prices go up 3 times in one day here in Phoenix.....My "x" had to sell her home and is now moving in with my son next door...Yeah, it's not going well......Luckily I own that home and they only have to pay rental for the space....The entire area was up for sale the buyer defaulted and the property went back to the owner a month ago.
  3. ghrit

    ghrit Ambulatory anachronism Administrator Founding Member

    Northeastern PA -

    I had my problems before the latest mess came along, layoffs and periods of unemployment. But I had a job when things went sour and real estate went to hell. That job was temporary, but full time and in my field, and the end date was known within a few months. As it happened, that end was also pretty close to when I was planning to retire. So I did, after all debts were settled, and relocated to here. The net effect on me has been a serious reduction in adventures (trips to places I've never been, visits to distant friends) canoes not bought, two (and long change) acres instead of twenty, hamburger instead of steaks, 100 or fewer rounds down range per week instead of 1000, and the thermostat set 3 degrees below the no sweater level in winter. With no family and no mortgage, things are not as bad for me as it has been for the guys with dependents, but the nest egg is a shadow if its former self. No health insurance, either.

    Yes, there has been some doubling up, too. The guy across the road moved his parents in to save the mortgage. (His wife, now ex, moved in with her lesbian friend.) He had to take a lower paying job driving locally because the outfit he was driving for (a building supply house) contracted dramatically.

    If you don't already own your own farm in this area, there are very few jobs available, and those are for the most part seasonal. The local dairymen are in big trouble, beef is not far behind. A lot of locals are jacks of all trades and work year 'round at whatever they can scrounge up. They are NOT busy, they can show up tomorrow and build your deck or drill your well. My tax guy (a CPA) labors for a road contractor in the summer to supplement his income during the slack tax season. One of my sons spent a month with me last year trying to find a job, there aren't any.

    A couple of the larger towns nearby are cutting police and fire staffing, they cannot afford the tax increases that would hammer the residents. And hoo, boy!! is that ever a contentious issue. Response times are tanking, and insurance losses climbing.

    If you squint really closely thru rose colored glasses, I suppose you can see green shoots in this area, but it is limited to waiting for natural gas prices to rise and make drilling the shale economical. That will help spending around here for the folks with big land, but the little guys in the apartments and rented trailers won't get much from it other than short term jobs as labor. Bear in mind that this area has never been a hotbed of high income jobs, it always has been pretty hardscrabble and folks are used to it. The "change" is not in evidence beyond rising millage, food and fuel prices.

    ETA: One possible indication of improvement is that the amount of spam to my home address has been dropping. Two possible causes for that, I guess. One, the spammers are finding jobs, or two, they have come to realize that all that hype about making money from home by sending out links for get rich schemes and coffee don't make near the returns touted, and they've given up. Death to all of 'em, my online life has taken an upturn now that I don't have to clear the spam cache at the ISP more than once a day. [winkthumb]
  4. RightHand

    RightHand Pioneer in a New World Moderator Founding Member

    Due to the nature of my work, I have an opportunity to see, first hand, the economic changes in small business in eastern CT. From my major routine clients, excluding strictly tax clients, this is what I have observed.

    Major lawn & garden equipment retailer and service provider: sales down about 150K from last YTD

    Manufacturer, firearms industry - Sales up up and away, Booming. Just doubled shop size and added 3 more CNC centers.

    Manufacturer - job shop - mainly medical devices industry - down substantially but lots of sales to US companies with Mexican mfg facilities (shipments directly to Mexico)

    Manufacturer - measurement systems, hardware and software - mainly nuclear power industry - growing

    Manufacturer - mfg, sales, and service - heat treating ovens - holding their own but down from prior years

    Manufacturer - aircraft industry - down down down - shop cut to half of former size and some machines sitting idle

    Manufacturer - coolers - stable

    Liquor store - about the same as prior years but sales merchandise sales have shifted from high end specialty wines and beers to lower end brands

    Video store - closed but mainly due to changes in technology, the reduced retail prices of DVD from places like WalMart, and NetFlix.

    Horse Farm - breeding, boarding and training - down by about 200K 12 month YTD. Owners taking a big hit.

    Auto Sales - used cars - stable

    Auto Repair Shop - bays sitting idle many days. they are being held afloat by commercial fleet repair contracts

    Auto Body Shop - In jeopardy of closing for two reasons: lack of qualified, reliable, technicians, and change in industry from repair to replace.

    RV Sales and Service - closed

    Rental property owner and management - 100 properties - stable. They cater to the 2 local university grad and international students - maintain about 98% occupancy but had 3 evictions in the past year, Tenants left owing a total of about 20K.

    Property Rental - Apt Building owner - full occupancy. Since these landlords don't know their tenants, they are unforgiving with late or unpaid rent.

    Power Washer sales and service - Commercial applications - business way down. Keeping the doors open but some days the phone never rings.

    Well Driller - business down by about 1/3 over prior years. There is more fracking and fewer new wells.

    Pump Service - sales and service - Business stable

    ISO training and facilitating business - entire east coast - booming.

    Dental Lab - They make the crowns and dentures - stable

    Building and Development - sold only 2 units last yr in a 14 unit new community - project with permits, roads, sewer, and water for sale.

    Building Project management - clients fell off the face of the earth. Now starting development of his own Condo Project on property he has owned for many years.

    Electrician - mainly commercial - staff of 10, stable

    Electrical, Plumbing, HVAC, and Remodeling - full service - on the verge of closing. Staff reduced from 20 technicians and office five yrs ago to 5 people now and I'm one of those 5

    Plumber - residential repairs - solo operation - stable

    Pool and Spa mfg, sales, and service - employs primarily Mexican laborers - Sales in the tank.

    Non-Profit community college foundation - donations for scholarships and grants down, zero fund growth

    Lawn maintenace - small 3 man company - business down and very hard to collect

    Remodeling contractor - one man operation - he's taken a part time carpentry job to offset business downturn.

    For me personally, I do well when my clients do well. I spend quite a bit of time on cash management - it gets harder all the time. Some of my clients who have never had cash issues are now borrowing from their lines of credit. For my retail clients, I spend a lot of time developing marketing programs, designing websites, and in general, trying to implement programs to bring the customers to my clients. I try to be flexible and provide whatever services clients may need. For some of them, I go in, provide a service, and leave. For others, I have staff to execute what I implement. some I see weekly, others monthly, and some quarterly. Some of my accounting customers bring their work to me and I do it in my office. Aside from general accounting, I see my job as finding solutions to their problems. the more solutions I find, the more work I get.
  5. fortunateson

    fortunateson I hate Illinois Nazis!

    North Carolina

    I'm an IT guy and things haven't been the same since the Internet bubble burst at the turn of the decade.

    Wife is a teacher. Left a job because of relocation. Now can't find anything because all the counties have cut their budgets. Probably wont' find anything for a while since they will hire those laid off first.
    Of course, county and state revenues are low, so they did the natural thing... raise taxes.

    I see they are back to building again in some of the new developments. A headhunter friend of ours says things aren't great but are way up from last year.

    I'm trying to sell a house. Lucky if I get one showing / month.

    Dismal, but things seem like they're breaking free a bit from last year.

    IMHO a deep long recession is ok. With the economic fundamentals the way they are, anything else is dangerous. I get nervous when I see things picking up because there is only one reason for it: The adrenaline effect of our current recklessly loose monetary policy. The long term result of growth on top of this shaky foundation will be cataclysmic.
  6. dragonfly

    dragonfly Monkey+++

    Now I am glad I chose to buy my small piece of land...It ain't much, but it'll be home soon...I can't take another rental raise.
    It went from $ 99.00 a month to over $350.00 a month, in the past 5 years!
    The property here was supposed ro sell some years back, we went thru about 6 prospects of buyers...no financing. ( good for me, I think)
    Up north, things are going from bad to really bad! No jobs, unless you are a rancher, have a gas station or a food store. I hope I can raise chickens and rabbits...everyone else that did that, have lost their in-town jobs and have left the area....Time to go back to the basics: car repairs, welding, machining ( blacksmithing work) and so on....If I had the ability, I'd drill a well, water is about to go up around there and they are paying a cent a gallon, rumor has it that due to the cost of maintaing the well and equipment, it could go up to 5-7 cents a gallon! Delivery has almost ceased for those with large tanks, of up to 2500 gallons, It used to be $98.00 for a delivery, not anymore! Now it's gone up to $212.00 for a load!
  7. fireplaceguy

    fireplaceguy Monkey+

    Denver (and most of the rest of Colorado) are doing "better" than a lot of the rest of the country. Unemployment is not as high as many other places, but we are feeling the heat.

    My BIL works at a tech company which, in deference to him I won't name. They just laid off another round of people - in secret! Never made the news, and the people involved were told to keep quiet if they wanted any chance of ever being rehired. He's still there, but has to take 8 additional unpaid furlough days this year. They are outsourcing another major project to India, to the same folks who screwed up the last major project. He's salaried, of course, and expects to be working some pretty long hours when this next India screw up lands in his lap..

    I live out in the countryside, and judge the economy by farm animals. Auction prices are way down. There are still cheap/free horses available, including some surprisingly high quality animals. People just can't afford to feed them. A neighbor who was big in miniature horses tried to retire and held an auction. Among the sale horses were several champions - really high quality stock. A lot didn't even sell, and what sold went for just 25% - 40% of prices five years ago.

    There's astonishingly good trophy elk hunting near by, and a friend's business (he leases 7,000 acres and guides hunts) was down 50% over the previous year.

    One of every nine Ag parcels in this county is in foreclosure and there are more foreclosure auctions every month. Very little of this inventory is selling. There is a vacant place I drive by every time I go into town - it's been vacant over a year and no effort is being made to sell it. It's not the only one with no sign out front. (The ones WITH signs aren't selling, so why bother?)

    Colorado home values have not dropped as much as the rest of the country. Still feels like a bubble market to me. There are very few Realtors left, not that I miss them. Ditto mortgage brokers and general contractors. Used to see homes and barns going up regularly out here, but have only seen one home and two barns go up in the last year.

    Every time I drive into town I notice another vacant store or two along my usual routes.

    I'm good enough friends with the mgr of the local farm store to know how they're doing. Sales are down significantly, and they are strictly prohibiting overtime. They have a record number of wood and pellet stoves left over after the winter season, and that's after starting with 15% less inventory last fall. The only bright spot is gun sales, which have tripled thanks to Obama. (Despite being out in the country, they sell a lot of evil black rifles. It's kind of fun to see AR-15's promoted alongside fence tools in the farm store mailer.)

    Government in Colorado is out of hand. Out of hand like an aggressive cancer. I moved out in the country to a rural county of about 20,000 only to find that this little county is as corrupt and thuggish as anything in the Denver metro area. They spend money like big city politicians, and then when they can't pay the bills they set low speed limits on country roads hide behind every other tree with radar guns.

    The second a foreclosed property goes vacant and no longer has animals on it, the county rushes in and changes the zoning in order to raise the property taxes. A Walmart just opened up, but the county made a sweetheart special district deal with the developer so sales taxes are higher than up in Denver. People are pissed, and the place is usually empty. Economically speaking, the government is a cannibal.

    These same government morons just destroyed a thriving little Chinese restaurant that had been in business for years, because it didn't have a public restroom. Never mind that they were the only Chinese restaurant in 25 miles or that they had a lot of loyal customers who didn't care about the lack of a restroom. (Killed by the same bureaucrats who approved them opening up in the first place. Next thing you know they'll be bitching that tax revenues are down.)

    That space, along with other empties in the same little center, will be vacant for a long time. As I look at the businesses around here, I keep thinking that if they weren't already in business it would make no economic sense to start them today.
  8. USMCwife

    USMCwife Monkey++

    Read "The Creature from Jekyll Island" by G. Edward Griffin. I'm reading it now. It explains what is happening, how it happened, and how any "green shoots" are only the results of band-aid fixes. It won't last. If we pull out of this, it is just a matter of time before we are here again, and the Federal Reserve is causing it all. Good info, but I have to fight sleep while reading it.
  9. melbo

    melbo Hunter Gatherer Administrator Founding Member

    Great book USMCwife. I've passed out quite a few copies over the years.

    Here's something I saw today:
    recession.special (Large).
  10. Tommy Jefferson

    Tommy Jefferson Monkey+

    On the upside, commercial rents seem to be coming down.

    I'm interested in moving to a different retail location. Several places I inquired about renting were outrageously priced last year. They've sat vacant for a year. I'm calling around again. The rents are slightly lower, but not low enough.

    One landlord wanted $2,800 per month last year. I offered $2,200 for 12 months. He refused my offer and earned $0 for the last 12 months.

    I blame the mainstream media. People believe the government lie that "things will get better soon", and refuse to lower prices.
  11. Clyde

    Clyde Jet Set Tourer Administrator Founding Member

    The only thing working against you is whether a property is paid off or not. People will keep holding out for rent based upon history. The only way rents get recast is after foreclosure or when the children inherit or if it is the sole source of income. We are creatures of habit.
  12. fireplaceguy

    fireplaceguy Monkey+

    Great book. None of this is an accident, and after reading "creature" you'll understand why. Another great read along these lines is "Extraordinary Popular Delusions and the Madness of Crowds"

    Read these two books and you'll be thankful for your silver and gold stash every waking moment of your life!
  13. brotherpoop

    brotherpoop Monkey+++

    Two signs of the times I have seen in dealings with my dentist and Ford dealer; the dentist makes me pay the entire medical procedure and after the insurance company pays them I get a refund. Any parts needed for repairs must be paid before the work is performed, apparently too many people were cancelling repairs and they were stuck with the parts?

    I have a cabin in northern Minnesota the past 20 years and I have never seen so much property for sale up there as now.
  14. Gray Wolf

    Gray Wolf Monkey+++

    Oregon has passed a tax on businesses, I don't know everything about it, but it is a tax on a business' GROSS revenue. And it's RETROACTIVE back to the first of last year. Result: Jobs are leaving Oregon. Personal observation:
    The guy that drilled the water well on my homestead has laid off all his employees and parked the equipment at his house, does small jobs himself, and will quit at the end of the year.
    Biggest fear? What will they do for revenue once they have driven out the businesses?
  15. melbo

    melbo Hunter Gatherer Administrator Founding Member

    It's like people in Oregon felt they weren't getting enough water so they plugged the well. Don't understand it but I bet it will be a ghost town here before long.

    I also thought that any ex post facto law was null and void from its inception? I'd refuse to pay if I still played that game.
  16. Tracy

    Tracy Insatiably Curious Moderator Founding Member

    They got those measures to pass, because they added an unemployment benefit extension as part of the bill, which gave them the vote of the unemployed who weren't thinking of the cost to those who might employ them.

    Businesses are leaving Oregon. Washington is a much better place to be in business and just across the river from Portland, in Vancouver, they're throwing out the welcome mat. Sure, the state got/will get the retro-active taxes from last year's gross sales, but at the cost of losing future revenues from fleeing or closing companies. Workers will either move (if they can afford to) or join the long, long list of unemployed Oregonians.

    Small businessmen are worried. Layoffs are prevalent and necessary for those who even have a thread of hope to stay in business. SB Owners are canceling vacation plans, limiting unnecessary purchases, and performing a lot of services themselves. Agricultural companies that are trying to stay afloat - without manpower, that couldn't be afforded - are facing unprecedented losses in sales. Equipment and machinery can be had for next-to-nothing at local auction yards.

    Food pantries, energy assistance programs, and local churches are turning needy people away, as they have more people standing in line for help than they have the ability to give to. One local church, who donates food on Saturdays, has gone from a few cars in the parking lot at a time throughout the afternoon, to a long line around the building that lasts for hours. Oftentimes, those at the end of the line go home with nothing.

    Robberies - and most frighteningly - daylight break-ins seem to be getting more prevalent.
  17. melbo

    melbo Hunter Gatherer Administrator Founding Member

  18. melbo

    melbo Hunter Gatherer Administrator Founding Member

    My wife made me a dental appointment in a new town at a new dentist for a routine cleaning. They had a slot for me 2 days later and I remember this used to take 30 days at a minimum. They also had slots for my wife and daughter the next day.

    At my visit, the dentist recommended some work on my teeth including an extraction of one lone wisdom tooth. I asked them when I could come back: (I'm thinking this is months out?) and they told me to go have lunch and come back in an hour. They obviously have half the clients they used to.

    Tonight my wife called the vet for an antibiotic for a cat with bloody sneezes. Vet stated that they couldn't prescribe that without a visit ($100). My wife said 'screw that', 1-800-petmeds here I come.

    I think one of her other appointments for some routine medical checkup was a 'we can see you this afternoon or tomorrow' type thing.
  19. VisuTrac

    VisuTrac Ваша мать носит военные ботинки Site Supporter+++

    Economic Recovery? Not likely in Michigan for the near future.

    Our official unemployment rate is 12.4 percent
    if you add all those that are underemployed (working part time but want to work full time) and those that stopped looking all together tack on another 10 percent for 22.4 percent

    In some regions of the state it's over 30 percent.

    a menards hardware that opened in 2008 had 75 positions and nearly 5500 applications. Don't know about your neck of the woods but those are some pretty steep odds of No Regular Paycheck.

    Housing prices are in the toilet.
    Take my own house for instance. In 2007 the SEV of my house equated to 280k. Today it equates to 130k. which is nice because that is about what we owe on it.

    Michigan has suffered a lot of layoffs, business bankruptcies and home foreclosures. My father in law was on that suffered all 3 of the above. Company he worked for, for over 20 years, filed for bankruptcy, the company got liquidated, he lost his job and subsequently his house because 336 bucks per week in unemployment didn't even come close to making his house payment. Was he over extended? You betcha he was but so are a lot of people here. He is now living with me and my family. Unemployment benefits ended some time ago. So now my wonderful wife is making my paycheck that hasn't kept up with inflation stretch to the breaking point. Savings is gone. Credit cards are maxed but we are by some miracle staying above water. Just barely. She is a coupon queen, and freaking amazing at it! When I married her, I got the better end of the deal!

    This summer we started converting our basement into an apartment for him so we could all have some privacy. During the project the circular saw,cordless drill and corded drill all magically died. I would have normally just replaced them but i instead tore them apart and attempted to rebuild them.

    I was successful on rebuilding the circular saw and corded drill by finding out the brushes were corroded and stuck in their holders. the cordless drill was junk. Attic fans stopped working. Instead of buying new i broke out the multimeter to find out what the heck caused them to stop working. Replaced the thermal fuse in the field windings

    In my case it is fix or do without at the moment. I've been trying to get some extra cash together with Christmas time here.

    I started looking at the stuff that i no longer use to see if I could convert that into cash.

    A 35mm Camera Outfit, a Palm Corder, a Couple of 17" CRT monitors and a 2.8Ghz computer system. I've had them up for sale all over the place

    Craigslist (watch out for scammers there wanting you to ship out of state/country), local electronic garage sale site, my facebook page to see if my friends are interested, multiple local forums and even here. Not a single taker. I've lowered my prices to rock bottom and even put in that i'd trade for 90% US Silver and I'm offering a conversion over spot to boot. No one seems to be spending. I put the trade for silver, cause I always accept that but local 'Coin buyers' and pawn shops around here are offering anywhere between 8 and 14X face. Dude I'm offering 21X just thinking that someone might not have 210 dollars laying around but maybe a roll of pre 1965 quarters in the sock drawer. that way to them it seems like they are spending 10 bucks but getting a 210 dollar computer system with monitor keyboard, wireless mouse and office 2003. No Takers.

    Now in the past 2 weeks i've seen
    Gas go from 2.79 to 3.10
    bacon go from 3.29 to 3.89 (one brand stayed the same but there is only 12oz in that package opposed to a full pound)
    bread has gone up 20 cents
    boxed cereal has stated the same but the boxes are 2 oz. lighter

    Oh yeah, and my Christmas bonus pretty much was gone before it arrived. Like getting an extra day in the paycheck. woo hoo. Well I guess at least I got one.

    About the only thing that I think I own that would sell as soon as I post would be any gun. but that's the last thing I'm going to sell.

    How far am I from falling into the abyss, trust me not far. But at least I am not a one hit wonder. Software development is the latest incarnation of myself but in the past I've been in welding, construction, machine shop,automotive trades. Only problem is, here in Michigan? Most of those are dying fields. As those industries got a 'Mitten Job' as most have left this state for good.

    Hey we were also the only state in the nation that lost population. Do you think that it's because we don't have any jobs here to offer our state citizens?

    So what do I want for Christmas? I already have it. A family that has a place to live, food on their plate and clothes on their back. Other than that, Not much. Just to keep what I got and not fall behind.

    But just in case anyone is Psychic, what are the next Powerball numbers, Private message me with the numbers.
  20. VisuTrac

    VisuTrac Ваша мать носит военные ботинки Site Supporter+++

    Melbos post about heath care reminded me of something.
    Eventhough I Have health care, I pay over 3000 of the annual premium and the first 1500 in costs. Then after the insurance kicks in. The big problem is with out paying for the coverage, one trip to the emergency room could bankrupt a person.

    there was a time when our family went with out health care for 9 months. talk about the scariest 9 months of my life. Just before i found a new job that offered insurance. my son decided to climb a tree get his arm snagged on a branch and rip open his arm near his bicep. so off to the e-room we went. those 14 stitches cost 200 bucks a pop. I told my son, next time he does that I'm going to sew him up myself.

    What ever happened to offering to pay with chickens, pigs or barter with your labor .

    Well at least my chiropractor will adjust my spine for free because i keep his computer systems humming along virus and spy ware free.

    I just don't know where the insanity of health care is going to end. but I'd prefer it to resolve soon.
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