Recession and Inflation????????

[John T 744]

Just heard this depressing news tonight. A possible double whammy for this upcoming year. I am a few steps ahead of this do to multiple jobs that I have that has worked so well together. Still I do have great concern for this if it happens. If it happens for me when I'm just about to get another business off the ground along with my main powerwashing business I may be forced to stay on my other job until My wife can get the other business to turn a profit and with this year so far projected to be a rough year...that has me really concerned.

On a different view about this I was talking to a good friend from the Midwest the other day who is also in the Powerwashing business. He has been in it a few years longer then my now 13 years. His take is he is continuously is making more and more money each year and he will just try harder to make more money without the economy concerning him all to much. He believes he will still make money no matter what because he is willing to chase jobs down that at times are far far from his home state. A real positive guy who is not afraid...I tip my hat to him and also for making me feel more confident about this coming year. Good guys do rub off you on a positive way. So keep your heads up high and keep on trucking and chasing those jobs cause they will still be out there.

[Doug Dahlke 114]

Economists keep talking about a recession coming. I think it has been here for a few months already. Inflation is at it's worst in 26 years. Rising fuel prices affect the cost of nearly everything else in the economy.

Our idiots in Congress in their push for more ethanol usage have driven up the cost of corn so the price of beef and chicken is up even more.

Now that housing has tanked people can't use their home equity to keep spending.

None of this is good news but I still am optimistic about the new year. People may be inclined to invest a little more in property maintenance if they know they will be in the house for awhile. Commercial work should still be good for the companies that can position themselves to get it.

[Beth n Rod 1,279]

Inflation has not been this bad since Nixon left office and the incoming president lifted the wage and price freeze that was in effect, thusly sending inflation through the roof.

Nixon Imposes Wage and Price Controls

Bush's mortgage rate freeze like Nixon's wage and price freeze. | The Smirking Chimp

Richard Nixon: Address to the Nation Outlining a New Economic Policy: "The Challenge of Peace."

Beth

[Jeff 232]

I am optimistic for my family & biz, because i have been saving and working on growth with my company. I think the country can with stand a short rec cession, although many will be hurting. I just fear a long dragged out recession.

Its tough out there and getting worse, the #'s keep coming in for all different things and really none of them look that good, they say if the #'s are bad for 2 quarters, it usually a sign of recession, well the #'s are now in and they aint lookin good

The sub prime stuff those banks & brokers who gave those loans should go under, they all knew they were doing bad lending practices

If its here I just hope its a short one for everyone

Good luck all

[John Doherty 126]

Good for you guys staying positive! We are letting ourselves be talked into a recession. This drives me nuts, are you feeling a recession? Did your business grow last year?

GDP is still forcast to grow, just at a slower rate.

Let's keep scaring people so they decide to hold on to the $500-$1000 for upkeep of their property for another year.

Inflation was higher in May, June, and July of last year, and in Sept & October 05, and in 1991,1990,1989,1988, and 1987.

The highest rate was actually in March 1980 @ 14.76 at the beginning of the Reagan Admin, due to the doomed economy from the Carter Admin.

I don't believe the hype, but I worry about what effect the hype will have!

[Beth n Rod 1,279]

How are we being talked in to a recession? Prices are what they are. I know I didn't go into any stores and tell them to jack prices through the roof. But we are keeping our eyes open and we are adjusting accordingly. As material and fuel costs increase, so too will labor rates so that employees can afford to live. You can't eat those costs and be healthy as a business. In the end your prices will have to go up. This may (or may not) mean that potential customers will not be able to afford you. Everyone has a finite amount of disposable income. Disposable income is what we have that we use for things like movie rental, a night on the town, or basic home improvements. It's not what we use for our fixed expenses like our mortgage, food, utilities, medical, food and clothing. If the amount needed for the fixed expenses increases, give the same household income, the disposable income decreases and the economy will feel it.

Beth :cup: :seeya:

[Tmrrptr 164]

I'm real happy to see most with upbeat thoughts.

PW pulled 4 successive jobs out of the hat for me. About six weeks ago it seems like everything just dropped over the edge.

Time for a new advertising campaign.

[PressurePros 249]

John D, I hear exactly what you are saying. Recession is a word. Yes it has some economic formulas and indicators that point to it happeneing but my feeling is that recessions happen because of the media. At the very least, the media exacerbates the problem. I just got done watching CBS Money Watch and all they discuss is doom and gloom. The president knee jerk reacts with proposed tax relief/rebate (don't know where that is coming from as the US continuously increases its deficit). The idea of a tax rebate is to put it back into the economy via consumer spending. Not two seconds after the story about Amercian households getting this windfall is an "expert" telling everyone to bank it and not spend it. The more people hear these experts telling them what to do with their money the more cautious they are going to get. The herd will follow and people's wallets snap shut.

I will still take no jobs more than 15 miles from my yard, raise my prices this year and probably add 100 new customers and another full time truck. The customers I chase don't just stop maintaining their property because of inflation or a slump in the housing market.

[Beth n Rod 1,279]

A Beginner's Guide to Economic Indicators

Bloomberg.com: Worldwide

RGE - Recent Macro Indicators Strongly Reinforce My Recession Call...

Econbrowser: Economic indicators take a turn for the worse

You're giving the media too much credit. I'll agree they chase stories and are very good at hype, but they did NOT create the economic indicators present today. If that were true they could hype things the other way and we would all be happy, prices would drop, and the money wold flow.

Beth

[John Doherty 126]

You're giving the general public too much credit.

You don't get viewers by saying, 'things are great, film at 11'.

[James 625]

Let's see the housing market is in the toilet (American Standard). That effects everything to do with building a new house or remodeling. The prices of houses are way over inflated due to the low interest rates of the last ten years or so( houses bought for 250K are now 4 to500k after 5 years). That means property taxes have gone sky high . Many people can not afford the price increase in taxes added to their mortgage along with food, energy and every thing else associated that has increased.

Mortgages were given out to anyone who applied. So now we have foreclosures and bankruptcies going threw the roof. The whole Real estate market is in a recession and we haven't seen the total effect yet. This is but one segment of the economy. Not every area of the country will be as effected as others.

Attorney's are laying off and so are architects, banks, appraisers and mortgage companies are closing up shop. Not to mention all the skilled tradesman who can't find work. I see a whole new addition of lowballers coming !

[John T 744]

Let's see the housing market is in the toilet (American Standard). That effects everything to do with building a new house or remodeling. The prices of houses are way over inflated due to the low interest rates of the last ten years or so( houses bought for 250K are now 4 to500k after 5 years). That means property taxes have gone sky high . Many people can not afford the price increase in taxes added to their mortgage along with food, energy and every thing else associated that has increased.

Mortgages were given out to anyone who applied. So now we have foreclosures and bankruptcies going threw the roof. The whole Real estate market is in a recession and we haven't seen the total effect yet. This is but one segment of the economy. Not every area of the country will be as effected as others.

Attorney's are laying off and so are architects, banks, appraisers and mortgage companies are closing up shop. Not to mention all the skilled tradesman who can't find work. I see a whole new addition of lowballers coming !

Unfortunately thats how it is here..Can't be blind to this. Also a bad trend that is coming in now is 6% of the people who were delinquent on there credit card payments is now up to 7.5% in just a few months. To not see there is any problem with that is like turning a blind eye to it.

Oh yea did I say that now some of our biggest Credit card companies are now taking on huge investors from Cash rich Countries such as China.

Very good business people like a Ken Fenner and alot of others I can see still doing well because there smart and determined but I can also see many others with diversified back grounds and different levels of Intelligents still feel the pinch from these rocky times.. I know I am and I had a great year this past year..

A fast example of feeling the pinch is my friends very successful pool company with over 35 employees..he was just telling me and a mutual friend yesterday how a loan company that he deals with for people to get the pool loans is no longer allowing those type loans. This has already cost him a loss of approx $25,000 to him in less then 2 weeks.. And how is that?? Because the people who were locked in to purchase a pool and the masonry work could no longer get those loans..so they bailed. Just an example.

Don't be blind to the times..........

[Celeste 341]

Not if your water is restricted!! Many areas now require documentation that proves some sort of legitimacy to get permissions to wash :) Those with that in place need to take FULL advantage! No lowballer can afford the fines if caught washing.

Recession or not.....dirt isn't going away. Real estate being as competitive as it is now, can't afford not to boost the appearances.

I say find the silver lining and make it platinum!!

Celeste

[Beth n Rod 1,279]

Let's see the housing market is in the toilet (American Standard). That effects everything to do with building a new house or remodeling. The prices of houses are way over inflated due to the low interest rates of the last ten years or so( houses bought for 250K are now 4 to500k after 5 years). That means property taxes have gone sky high . Many people can not afford the price increase in taxes added to their mortgage along with food, energy and every thing else associated that has increased.

Mortgages were given out to anyone who applied. So now we have foreclosures and bankruptcies going threw the roof. The whole Real estate market is in a recession and we haven't seen the total effect yet. This is but one segment of the economy. Not every area of the country will be as effected as others.

Attorney's are laying off and so are architects, banks, appraisers and mortgage companies are closing up shop. Not to mention all the skilled tradesman who can't find work. I see a whole new addition of lowballers coming !

That pretty much sums it up!

Beth

[Tmrrptr 164]

Beth,

I found someone who sums it up well and has made a presentation I think is quite good.

Bear with me, I don't know how to cut and paste url's very well...

And DON'T LET JOHN T READ THIS STUFF!

He sounds stressed out enough, already!

The Oil Drum: Canada | Discussion of Energy and Canada's Future

Wow! it worked...

Go to the third article on the page and follow it...

It's called, "The Year in Review and a Look Ahead for 2008."

Posted by Ilargi under Economics/Finance, by Karl Deninger

It's loong.

It's NOT cheery.

Never-the-less, I am coming to subscribe to these folks theory.

They are much more intelligent than I.

IF, they are indeed correct, decisions must be made in preparedness for the scenario they depict.

I personally am NOT situated favorably, and must accept the cards as they are dealt.

If someone is capable of disputing the views presented with facts, and figures, I'd sure like to hear about it!

Rich

[Jeff 232]

My accountant in the past few months has laid off two workers and its his busy time, tax time. He's lost a lot of service companies, Construction is way off, which also takes away from everything else. The trickle down effect

Its looking like a good year for us, but I know that could change. some with money are going to hold onto it longer just in case

Damn, I wish we could keep Bush in another 4 years

[John Orr 206]

In a past life, I was a sales manager for a large, national, pest control company. I was told, and subsequently found to be true, that in a "down" economy, homeowners will cut back on many things, but will continue to maintain their homes. Since my business is 98% residential, I'm not overly concerned about an economic slowdown - at least not yet.

[Tmrrptr 164]

A plumber I spoke with says he is only doing emergency repairs.

No little projects or upgrades.

A carpenter I know is completing a small project, with nothing scheduled. RE agents he works for are pulling their signs and closing the doors. Two spec builders we know went down in flames, as did a venture capital company.

Wall St dropped almost 400 points today! The headline was they finally noticed the service sector was down for the first time in 5yrs. Wow... Nice to be noticed!!!

Allied Van Lines filed for bankruptcy... guess folks are leaving the furniture behind?

The price of a barrel of oil has dropped, because US reserves are quite high... Yup! The service guys that motor back and forth getting the work done, have NOT been motoring.

I'm hearing more than a few rumors about low pay scale workers doing their tax returns and will be getting $6k back from the fed!

Maybe that's how W hopes to get things back on track? or get them to recover?

I don't think that will do it...

Cruised through a pawn shop today looking at guitar amps for my kid... prices haven't come down yet, but they sure got a LOT of construction power tools in there! It was STUFFED!

It's probably a good time to make the rounds and just visit with people you haven't seen in a while... be sociable, and see what's going on out and about.

Fishing is always good! Invite some new people along.