All the news outlets--CNN, ABC, NBC, CBS, Fox, and major newspapers like USA TODAY, the Wall Street Journal and the New York Times--keeping beating the drum that the U.S. is mired in a recession.
Furthermore, the news gurus say that while recovery from the current recession is happening, it's glacially slow, and most things (spending, wages, jobs, workers' benefits, pensions) will never reach pre-recession levels.
Here's what I think, based on the long checkout lines and crowded, busy parking lots I've experienced this summer at Wal-Mart and Lowe's stores in Tennessee and the Carolinas. I'm also basing my thoughts on what I've encountered in recent months at fast food outlets like McDonald's, Wendy's and Chick-Fil-A.)
We are in a pseudo-recession. A lot of people still have money and they're spending like crazy.
Don't believe me?
Visit any Wal-Mart or McDonald's or Lowe's.
The cash registers are zinging! Employees at restaurants and retail outlets seem stressed to the max, barely able to keep up with the never ending flow of anxious-to-spend-money customers.
What recession, really?!
19 comments:
I agree to some extent. I've been thinking to myself the past few months, "wow, there's just no way that EVERYONE is broke." But "recession" can be a mentality, I've found. It can be a way of living that you never grow out of. Great Depressioners, for example, were never the same; they stayed away from banks, they never spent money frivolously again. The same can be said for what's happening now. Financial "experts" and media professionals are so used to crying recession, that it seems like a big leap to say, "it's over. We're out of it." On a smaller scale, individuals may not be living paycheck to paycheck but they're so scared of all this recession talk that they continue to shop at the Wal-marts and McDonald's of America. It makes you wonder: if CNN, FOX, MSNBC and all the others would start broadcasting, "you're fine. Go spend money. Go hire people," would people act any differently?
I have mixed feelings. I don't think things are as bad as we are being told. I think its cautionary. I've seen lots of kids get jobs straight out of college...but then I also have seen some who are still struggling.
Other times though, like when I drive around Rock Hill and other areas and I see several businesses closing (The Station, Harry and Jeans) I think, "Man things must be pretty bad if these places are closing. I thought they were popular."
As for long lines, I don't think that will ever change. Some people spend, throw huge weddings and go on expensive vacations regardless of how much money they have. It seems alot of people in America can't live within their means and would rather morgage their house 3 times for that trip to Hawaii then save for their kids education.
you're so right about the "great depressioners," anna. my parents fit into that category. i've had to fuss at them to turn on their a/c during this sweltering heat wave. they tend to turn it on to the 'fan' setting and let it stay that way!
and yesterday i learned from my 92-year-old neighbor in rock hill that she has not once turned on her a/c this summer. she gives all her money to her church and to others, but is averse to paying for a/c. oh well...
and jessica: i agree that the long lines are here to stay. people breathe; therefore they spend.
just part of human nature, even in the presumed weak/soft economy.
Long lines at Wal*Mart (Save Money, Live Better), Lowe's, and fast food chains do not necessarily mean people are spending like crazy.
If folks were flocking to South Park Mall, maybe.
On what are people spending money?
Ramen noodles? Sam's cola? Equate equivalents? Are they doing-it-themselves from Lowe's?
Wendy's and McDonald's have dollar menus. Say it with me, dollar menus.
Chick-Fil-A, uh, well okay, you got me there. I call fowl!
Recessions are an economic condition and refer to the economy as a whole. I'd say, based on comments from experts who understand it better than I do, that we are slowly coming out of it. Part of this recovery is getting people to continue shopping - no economy can recover without consumption.
But there's also a psychological factor. Many people are shopping differently out of anxiety - which is why we see cheaper stores flourishing. They are not just retaining clients but attracting new ones. Big box marketers are suffering - and pulling out all the stops to keep the ones they have through heavy discounting.
People shop rationally for necessity and emotionally for satisfaction. Who doesn't love a bargain? It's simple consumer psychology - and the American way of life after all.
The recession does not exist *everywhere.* It still exists with construction businesses, though; people don't have the money to take loans out to build stuff so the construction industry is tarnished. Also, if there wasn't a recession, my family would not be moving this week into smaller house.
Blest are they whose businesses have improved. My family is still struggling.
I think a couple of y'all nailed it on the head. Things are improving, but they are not what they were. And the Depression mentality, man, I sure think differently after some of the stuff I've went through and seen in the last year. But some people are also born spenders, they would spend and spend using credit cards or what have you. Some will always try to live within their means, frugally or worse, and others won't. Those two just may have changed some sides lately.
Jade
Two other people personally emailed me their comments on this post. Here's what they wrote:
Person #1 (in her early 30s; lives in Durham, N.C.): "All I know is that we are still living paycheck to paycheck and I still hate shopping at Wal-mart!"
Person #2 (in her 50s; lives just outside of Raleigh, N.C.): "I think this recession is real and still here. I listen to a lot of people in my profession and it is heartbreaking to hear their stories. My cousin in MD. just lost his home, a local newspaper has pages and pages of foreclosure listings every week. (and you know that Cary is a town that isn't affected by this nearly as bad as other cities across the nation.) I could go on and on, but you get the jest of it!!"
Thanks to all of you who have shared your insights on this topic.
You all had something to say, and you said it well!
If there are others in the blogosphere who want to comment on this, have at it.
I might use what you share for a short article in a journalism trade publication.
Help me understand this "recession"!
It's hard to change that "I want" mentality to the "I need," which is why those Wal-Mart lines are still ridiculously long (and why I still avoid it like the plague). I'd guess that some of the people in those lines are now getting their "I want" fix at Wal-Mart or Chick-fil-a instead of visiting the mall or Outback. People are still spending, but if they're anything like me they're looking for the better bargains.
Lee
I think the recession is real--and even for people whose pockets are not hurting as badly, the psychological impact is still strong. I live in one of the better neighborhoods in Rock Hill--Yk Rd Elem school, Rawl Rd, N'western--very desireable. And yet there have been 8 foreclosures within two blocks of me this year. People are shopping at WalMart, not Earth Fare, TJMaxx, not Pottery Barn or Coldwater Creek. Fewer people have lawn services. They're taking stay-cations. They're worried about one of two earners losing a job and it all falling apart. People were living at the end of their credit lines for so long...and now those lines are being reeled in. A psychological recession is still a recession. They thought Obama would wave a magic wand and fix things. Despite the fact that such wishes were unrealistic, I think that's had a big effect on people's morale, too.
Appreciate your comments, Lee and Jo. Very thoughtfully written and raising some points I had not thought about.
"I want" vis-a-vis "I need" always something that plays out in the back of all our minds.
And I had never come across the term "stay-cation," but surely that's the case for lots of folks in all our neighborhoods.
Maybe this "recession" is real?
Maybe.
I rarely go to the malls anymore and had ratcheted back my spending, but today I needed to make a couple of significant purchases, had limited time to search, and wanted to ensure that the brand I prefer was available. The mall was the place for me today.
Intending to make only two purchases, I ended up with six items; and the clerk enthusiastically informed me that I had saved $114. (I spent $140.) It’s even happening in the grocery checkout line where the clerk usually announces how much I have saved. Really, I’m just interested in how much I have spent.
How many others, I wonder, are spending what they don’t intend to spend—only to “save close to 40 percent.”
“Savings” such as these certainly can cause consumer confidence to rise. We keep on spending to save. Seems like flawed thinking to me, but I’m still reveling in how much I went out and saved today.
A person, in her late 40s or early 50s, who works on the staff at Winthrop University emailed me the following comments, responding to my assertion that what we are actually experiencing is a "pseudo recession":
Maybe you are hanging out in places with thriving economies or in "the good part of town."
I think a lot of Americans are still in trouble. And I worry for college graduates who have big loans to pay off.
And here's a comment emailed to me from a high school teacher:
...I witnessed a scene at Belk that disturbed me:
A little couple tried to make a payment on their charge with another credit card. The clerk told the little lady, who was around seventy, that their policy is to accept only cash or checks as payment, not another credit card. The clerk had to repeat the policy to the couple.
The lady replied, "That's what we've been doing."
In another situation, (another store) a clerk asked how I was doing. I made small talk, telling her how I had visited one set of grandchildren out of town and returned to give equal time to another set who live close to me and had only recently begun my vacation.
She responded by saying her daughter and her family have moved in with her. Shaking her head, she said, "I tell you."
"I tell you," she said again, continuing to shake her head.
"I'm sorry," I said to her.
I feel the pain of these people. Is the recession real for them?
i should add that the high school teacher who posted the previous comment shared with me that the store clerk whose daughter and family had moved in her had a "look of despair in her eyes" as she related this (to the teacher.)
So that bit of thick description helps all of us feel her pain.
The places you mentioned being busy are all more economical places to spend money. Maybe people that would have gone to OutBack are now going to McDonalds when they go out to eat, for instance. Maybe people that would have shopped at name brand stores in the mall for clothing are now going to Wal-mart due to prices. Just a thought...
Yes, we're definitely in a recession, according to my first cousin, a 61-year-old USAF retiree who lives in Panama City, Fla.; he shared the following with me in an email:
Here's my take on the recession:
You can't make the call based on what you see in the store lines--especially the Buy-It-Cheap-Marts. It's all about numbers. A lot more people are out of work (who want to work) than normal.
Simplistically, 10 percent unemployment means only 9 jobs for every 10 people who want to work. The 10th guy is drawing his unemployment check and looking, but you'll STILL see him in Walmart buying groceries, because he has to eat. He may be one or two months behind on his mortgage payment, but he'll still need to feed his family.
And for the big family treat, you may also see him at McBurger with his clan, but not at Appleby's or the local steaks-R-us.
I own a home in the FL Panhandle that would have sold for $285k three years ago, but appraised for only $170k earlier this year when I considered
a second mortgage. Some homes in my neighborhood have been on the market for more than a year, the same upscale neighborhood where homes were seldom on the market more than three months before the recession.
Until we get back to a more normal one-in-twenty without a job, then it's still officially a recession.
So if you have a job, then congratulations...and why haven't you bought a new car this year so the car salesman can afford to buy my house? I'll even give him a deal and take 250k! Do your part, people....reach way back under the mattress and go buy something!!
The owner of a small weekly newspaper in the mountains of western North Carolina told me that the recession lingers in part from the news media's constant reminder that times are bad. Here's what she wrote:
The recession is real here because the Christmas tree growers have had a bad lick the last two seasons after Ashe County flooded the market with cheap trees.
Also, there is not much building despite the low mortgage rates, thus construction workers have been out of work. Our unemployment rate is down about a point and a half, but this can probably be attributed to the tourist season.
As you said, however, Walmart and the restaurants seems to do a brisk business. I have noticed that most of them pay with credit cards.
I do believe that the mainstream news media contributes to the recession with their negative reporting, causing people with money to hang onto it.
I do not think the government stimulus programs helped the economy, especially the clunker deal. Many people in other areas traded in their clunkers for new vehicles, then could not make car payments.
Our business is doing well because we keep our advertising rates low and we all multi task.
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