Monday, March 16, 2009

CONSUMER DEMAND HAS BEEN SATURATED.

SIDE TRIP, ANOTHER SOURCE OF THE DOWNTURN, CONSUMER DEMAND HAS BEEN SATURATED.

WHICH BRINGS ME BACK TO THE PERMANENT ROLLER COASTER ECONOMICS. RIGHT NOW, TECHNOLOGY HAS VERY POSSIBLY MADE TOO MANY PEOPLE HAPPY. HAPPY TO STAY HOME, TO BUY LESS SINCE THEY HAVE SO MUCH. HOME THEATERS AND HOME DELIVERY, VERY MUCH ON THE RISE, CERTAINLY INTERFERE WITH POINT OF PURCHASE DEMAND FROM PERIPATETIC REVELERS. STAY AT HOME PLEASURE SEEKERS BUY LESS. AND TO REPEAT MYSELF, A LOT OF MODERN GADGETS ARE LOTS OF FUN AT HOME. VIDEOS CAN NOW BE DELIVERED. MARKET DELIVERY IS RISING, SLOWLY, BUT ENOUGH TO NEGATIVELY IMPACT POINT OF PURCHASE SALES. AND THIS IS CYCLICAL. UPS AND DOWNS. AND RIGHT NOW PEOPLE HAVE ALL ABOUT BOUGHT AS MUCH AS THEY NEED. JIFFY LUBE WASN'T AROUND YEARS AGO. NOW THE SAME YOUNG PEOPLE WHO YOU SEE DRINKING WATER INSTEAD OF SODA, ALSO LOOK AFTER THEIR CAR'S HEALTH. NOT TO THE BENEFIT OF THE ECONOMY. SO IT'S UPWARD OR DOWNWARD, BUT NEVER REALLY HUMMING. EVEN AT ITS BEST, A LARGE FRACTION OF PEOPLE SUFFER FROM HALF
EMPLOYMENT AND FEAR OF JOB LOSS. IT HAS BEEN EVER THUS, SOMETIMES BETTER SOMETIMES WORSE. BUT NEVER GOOD. NO ECONOMY HAS EVER BEEN GOOD, IN THE SENSE OF PROVIDING A SENSE OF GROWTH AND SAFETY AND HOPE FOR THE NEXT GENERATION. IT NEVER REALLY ZOOMS ALONG. PEOPLE AT THE TOP, THE TOP 25% DO WELL ALL ALONG. THE REST OOCH ALONG. I WAS HALF EMPLOYED FOR A DECADE, AND BEFORE THAT, A QUARTER EMPLOYED FOR FIVE YEARS OR MORE. COMMUTES INCREASE, JOBS ARE OUTSOURCED TO ASIAN SLAVE LABOR. AUTOMATION HAS BEEN TAKING ITS TOLL FOR A HUNDRED YEARS, AND RATHER THAN CITIZENS GETTING THBENEFITSTS OF EFFICIENCY, TOO MANY ARE LEFT JOBLESS.

CARS TAKE YOU FROM ONE PLACE TO ANOTHER. IF YOU KEEP THEM CLEAN, THEY WILL LOOK NICE. CONSPICUOUS CONSUMPTION AND JUST THE PLEASURE OF A NEW CLEAN TROUBLE FREE CAR IS A LUXURY THAT WILL SHOW AN EROSION. A WELL KEPT SIX YEAR OLD CAR FITS IN JUST FINE. NO ONE WANTS A JUNKER, AND SUCCESSFUL PEOPLE DON'T HAVE THEM. JUNKERS ARE FOR THE POOR. I DROVE JUNKERS FOR YEARS. NO CAR PAYMENTS WAS THE INCENTIVE. NOW I DRIVE A WELL MAINTAINED 14 YEAR OLD CAR THAT LOOKS A LOT LIKE THE NEWER CARS. IT'S FAST, TROUBLE FREE, AND NEWLY REPAINTED. AND NO CAR PAYMENTS. OCCASIONAL VISITS TO THE MECHANIC. SO IT'S A LITTLE BIT LABOR INTENSIVE. AGAIN, BEATS THE CAR PAYMENTS. MOST AMERICANS DO THAT. AND FEWER AND FEWER AMERICANS ARE GOING FOR THE NEW CAR EVERY THREE YEARS. ITS A LUXURY YOU CAN DROP. AND THE EFFECT ON THE ECONOMY IS BOMBASTIC. THOUSANDS UNEMPLOYED. WORKERS ON THE LINE, AND SALESMEN IN THE SHOWROOMS.


HEADLINE. HALF OF AMERICAN NEW CAR BUYERS ARE WAITING. THE SAME THING HAPPENED IN THE NINETEEN FIFTIES, AND IKE CALLED FOR A "YOU AUTO BUY NOW WEEK". THERE IS MORE TO THIS THAN FRUGALITY. THERE IS A CYCLE OF INTEREST IN NEW CARS. YOU PUT IT OFF AS CONSPICUOUS CONSUMPTION, BUT IT IS A COMPLEX MIX OF MOTIVES AND EMOTIONS, AND FRUGALITY PLAYS A ROLE OF COURSE. READ BELOW;

MORE AND MORE PEOPLE ARE GRADUALLY REALIZING A CAR NOW LASTS SEVEN OR EIGHT YEARS, AMERICAN OR FOREIGN, AND THERE IS NO NEED TO BUY NEW EVERY THREE YEARS. THE NEW CAR IS SIMPLY HARDLY ANY DIFFERENT FROM THE YEA BEFORE. IN FACT, IT'S MY BELIEF THAT THIS MIGHT BE BECOMMING A PERMANENT NEW PURCHASING HABIT.

AND BY THE WAY, TOYOTA IS SUFFERING EQUALLY. SO THE QUESTION OF QUALITY IS UP IN THE AIR. WE CALLED THAT A FACT CHECKING QUESTION, AND IT STILL IS. CHEVY HAS A 100,000 MILE WARRENTY. THAT SAYS A LOT. IT'S NOT YOUR FATHER'S BUICK. TODAYS AMERICAN CARS ARE BUILT TO LAST. MAYBE NOT TO THE DEGREE OF THE JAPANESE, BUT TO A HIGHLY ACCEPTABLE LEVEL. FACT CHECKING WILL PROVE ME RIGHT OR WRONG. BUT I WILL NOT BE SURPRISED IF THERE IS A VERY CLOSE RACE NOW FOR CAR LONGEVITY BETWEEN US AND THEM. AND THAT THE AUTOMOBILE CEO's ARE BEING UNFAIRLY RAKED OVER THE COALS. WHAT STARTED ME THINKING THIS WAY WAS THE CLAIM, UNDISPUTED, THAT ACROSS THE BOARD AMERICANS PRODUCE MORE HYBRIDS THAN FOREIGN MANUFACTURERS. THAT AND THE FACT THAT NON AMERICAN COMPANIES ARE FACING THE VERY SAME SETBACKS. THE CLAIM OF REAL INFERIORITY OF AMERICAN CARS IS SUBJECT TO REAL DOUBT.

CAR COMPANIES WORLDWIDE ARE HURTING AS THE RECOGNITION SINKS IN THAT A NEW CAR IS THE FIRST LUXURY TO DROP, IF YOU HAVE A NICE FOUR YEAR OLD CAR THAT NEVER GIVES YOU ANY TROUBLE AND LOOKS AND FEELS JUST LIKE THE NEW ONES.... I'M SURE I HAVE MADE MY POINT OVER AND OVER. PROBLEM WITH WRITING IS YOU DONT KNOW WHEN YOU'VE BEEN ACCEPTED BY THE READER.

WHAT THE CAR COMPANIES HAVE TO DO IS GET GAS PRICES INTO THE SIX DOLLAR GALLON RANGE. THAT WILL SPARK HYBRID AND PLUG IN ELECTRIC CARS. BUT THAT WILL BE TEMPORARY, BECAUSE THOSE OWNERS WILL GO FIVE OR SIX YEARS AFTER PURCHASE. THAT IS, IF THE HABIT OF TRADE-IN AT THREE YEARS BREAKS DOWN, THE HYBRID SOLUTION WONT MAKE MUCH DIFFERENCE. WE MAY PERMANENTLY LOSE A QUARTER OF OUR CAR INDUSTRY.

HOUSING


AS FOR FORECLOSERS . THE FACT CHECK QUESTION IS WHAT PERCENTAGE OF THEM SHOULD HAVE BEEN RENTERS, NOT OWNERS, AND WERE TALKED INTO TAKING A STEP UP THEY COULDN'T MAINTAIN. IT'S A BITCH, BUT THE PATH TO HELL IS LINED WITH GOOD INTENTIONS.

BUSINESSES FAIL, MARRIAGES FAIL, HOUSES GO INTO FORECLOSURE. IT'S NOT AN IDEAL WORLD, LIBERALS WISH IT WERE.

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