Perception of the economy?

[dbuckley]

Joe the Plumber has made the news here in NZ

Clearly the ECs are doing it all wrong if Joe makes a quarter mill...

From where I sit many miles away - The American economy powers the world. Since the end of world war two the US economy has been driven by consumer spending, which until recently accounted for 70% of the US GDP. In recent years that money for consumer spending has come from folks "releasing equity" on their homes by taking out second and/or top-up mortgages.

Now house prices are on their way down, and the credit market is frozen.

The idea of pumping what I believe is now 2.5 trillion dollars of American taxpayer wealth into the markets is to get credit going again, so the money can start flowing again, but the problem is that homeowners have no equity left in their homes to mortgage (and many are in negitive equity situations) and now the banks are lending prudently again, they are (quite rightly) not prepared to lend to people who are over-leveraged.

So there is no consumer spending to re-start the GDP flow and best as I can see, there wont be any time soon. There is little manufacturing left in the 'states to generate real wealth through adding value to raw materials and subsequently through exports.

So in the short term, I cant see how this is going to end well.

Given America has a problem, the world has a problem, so even though our banks in Aus and NZ went no-where near the subprime mess that started this all off, they are still being hammered 'cos the whole world is being hammered.

And I've deleted the next paragraph as it could be interpreted as having strayed from economics into politics, and its best I dont even appear to have gone there

 

[iaov]

The only thing that makes a dollar worth anything is that someone believes it is worth something. Otherwise it is just a piece of paper with ink on it. It is a matter of perception and often in society, those perceptions are based in the faith we have in our leadership.Can't realy take this line of reasoning any farther without it sounding political but I am optimistic that we will soon have strong leadership again and the the economy will be just fine. We certainly are not going to see the boom im new houses being built that occured in years past as there are too many unoccupied houses out there now.In my part of the world most of the building in recent years has been high end custom homes.This has slowed with the uncertianty of the stock market,but that will work it self out too! I'm lucky up here in the northwoods as it is still a place where rich people want to build thier dream homes. In the mean time I'm finding enough remodeling jobs and small installations to keep gas in the Harley and I may even have enough time this fall to do a little bow hunting.:smile:

 

[Rockyd]

dbuckley,

Thanks for a view from outside of the U.S. shores. Reminds us here at home that need the wheels turning and burning back here at home! Thing will get a little tough, but this to will pass. First time America has had to go through the same cycle as a construction cyclical period for many people. Baton down the hatches a bit, stand tall after the storm.

 

[electricmanscott]

Joe the Plumber has made the news here in NZ

Clearly the ECs are doing it all wrong if Joe makes a quarter mill...

Stupid US media really knows how to beat a non story to death. And i guess International media as well.

The answer to Joe the Plumbers question should scare the hell out of anybody that supports a capitalist economy or just any American period. Absolutley disgusting.

 

[brittle]

I started my business in May of 2006 and by the middle of last year I had 2 to 4 guys in the field, mainly service call work. It was a great feeling to build something from nothing and finally get into a groove at 47.

Business started slowing about 3 months ago and as come to nearly a stop. It's like the phone line has been cut. The last time I received a call for something new was 8 days ago and it was a $600.00 job. If the phone rings now I expect a solicitation.

What am I doing to fix the situation? I'm taking the time to get my advertising straight like I should have in the beginning. I?m getting graphics on the vans which I will park around town if I need to. Improving Internet marketing and may do some direct mail but only if I find non-competing partners to share the cost. Also doing a little telemarketing. I still need to get into some networking groups. There are not as many fish in the pond, but there?s still fish!

I count myself fortunate as my wife has a very good job that can keep us going but I am starting to not sleep well. Lots to say about the politics of what got us in this situation but I'll hold back on that one.

 

[charlie]

We, the moderators, are appreciative of you keeping politics out of the conversation. I sincerely hope that the stock market does pick up and the consumer confidence picks up after the rhetoric of the election is over. I am a "____" but if the other candidate wins, I hope they do a good job. :smile:

 

[TwinCitySparky]

Just be carefull what you say about the economy, look what they are doing to, "Joe the Plumber" for speaking out, they are going to teach him a lesson, they are already looking at his taxes and who knows what else.

Thats an interesting comment. Last night my local news reported that "they" asked joe if he had a plumbers license. His answer: NO - the boss holds it. They then asked his boss if he had one. He said NO he doesn't have one either. Of course they work in an area where licenses are necessary.

Joe the plumber (and his boss) are now most likely unemployed.

The irony.

 

[SEO]

keeping politics out of the conversation. I sincerely hope that the stock market does pick up and the consumer confidence picks up after the rhetoric of the election is over. I am a "____" but if the other candidate wins, I hope they do a good job. :smile:

I agree with Charlie.:smile:

Edited to fix the close bracket on the quote.

 

[petersonra]

Maybe its just me, but Im doing just peachy. I work alone and hire help when I need to. I work out of my home. I started out at the beginning of 2008 and I just cant wait untill everyone stops worrying. If im holding my own now, I cant wait untill we have a bull economy again. Maybe ill hire a mechanic/journey man and make some real money! Either way my wife gets a nice check from me every week and with her salary and bennies from the hospital we are doing so well we figured its now time for a kid.

I have no doubt you will be chastised for charging too little to afford your own benefits. So consider yourself chastised.

Guys with low overhead will survive the crunch a whole lot easier than guys that don't.

I know a fair number of self employed people that rely on a spouse's health insurance. I think that shows some good sense, rather than some kind of character flaw.

 

[ohm]

I have no doubt you will be chastised for charging too little to afford your own benefits. So consider yourself chastised.

Guys with low overhead will survive the crunch a whole lot easier than guys that don't.

I know a fair number of self employed people that rely on a spouse's health insurance. I think that shows some good sense, rather than some kind of character flaw.

Each and everyone one of us has a unique situation..maybe that's why we're called individuals. We must gather our assets and liabilities and use them to our full advantage (business plan or model) if simeone has a problem with that ...that's their problem. This is America!

 

[Fulthrotl]

We, the moderators, are appreciative of you keeping politics out of the conversation. I sincerely hope that the stock market does pick up and the consumer confidence picks up after the rhetoric of the election is over. I am a "____" but if the other candidate wins, I hope they do a good job. :smile:

it isn't about partisan politics. our current situation has it's roots
starting about 25 years ago, and it really isn't realistic expecting
a new hood ornament to correct a spun main bearing. it doesn't
matter the color of the hood ornament, or putting lipstick on the
hood ornament.... we've still got a spun main bearing, and no oil
pressure. the engine isn't gonna work.

we are now, as a nation, experiencing collectively what we have
been experiencing individually. i live in southern california, where
conspicuous consumption is a way of life.

for the last 10 years we have been pulling equity out of our homes
to feed a drunken glut of purchasing.... all the people pulling 3 axle
trailers with 5 quads behind a brand new dually, going to the desert
every weekend..... well, they were refinancing the house to pay
for it, and selling off the back two bedrooms. and after two years,
they were gonna flip the house, and start over again. it would be
a wash, and all would be forgiven. all the financial clarity of a
sailor on a three day pass.

so, how can we really blame "politicians" for doing the same thing
on a national level? we elected them.

and all the "politically correct" solutions to this? to me, they all
sound like a farmer with terminal cancer trying to borrow money
on next year's crop.

you cannot get out of debt by borrowing money.

how long's it gonna last? honestly, call it ten years to get out
of this hole. nobody wants to say that, but it'll take that long
to earn enough money to offset the excesses of the last 15
years. individually and collectively.

life so far has taught me this:

all thought is creative.
we attract what we fear.
if i blame someone else or something else for
my situation in life, then i've given all of my power
to them, or it, and made them, or it, responsible for
fixing it. and i'm screwed, because "they" or "it" can't fix it.

the solution isn't political, it's to be found elsewhere.
if we think we've found a political solution, we are just
wasting time not looking at what the real problem is.

that's as far as i go on this forum.


randy

 

[goldstar]

Joe the Plumber has made the news here in NZ

Clearly the ECs are doing it all wrong if Joe makes a quarter mill...

Just to clarify and to show just how things get twisted around by "spin doctors", Joe doesn't make $250K. He wants to buy a plumbing business that has the potential of making over $250K. A business that has trucks, material, employees and overhead. That $250K figure was thrown out there and it was never explained whether that was a gross revenue figure or a net figure. However, if there are any of us EC's out there that are netting $250K annually would you please share your secret here with us:-? :-? :-?

 

[ptonsparky]

I think things are slowing a bit but service work for me is seasonal and harvest is a about a month later than last year. I have so many other things going on right now I haven't had time to worry about work. Mutuals are down 30% from January for me. The funds we were investing for a new house are now just going to a savings account. I still am donating to my Simple IRA and don't intend on stopping even though wife is wanting to bail. I just hope to recover most of those losses by retirement in 10-12 years.

 

[electricmanscott]

With all the financial and political experts in just this thread it is hard to imaginne we are in such a dire situation. :wink:

 

[Fulthrotl]

With all the financial and political experts in just this thread it is hard to imaginne we are in such a dire situation. :wink:

that's because we are all here posting, and not campaigning....

it *is* amazing that a group of electricians can solve the global
picture so well, but if you picked four of us at random, and sent us
to set switchgear, moving it up stairs and thru a door, there
would be five plans to accomplish that.....

 

[peter d]

Doom and gloom, doom and gloom.

The globe will continue to spin, the sun will rise and set and life will go on no matter what condition the American economy is in. People have always found ways to adapt to their circumstances and the current economic crisis is no different.

 

[cschmid]

OMG I am lamo this is hilarious..

Poor Joe the plumber got his 10 minutes of fame and years worth of misery from the national news programs..Thanks to McCain and Obama..

The economy is though but it is still moving..the people who have the cash and jobs to keep the payments and are able to spend are making really good deals..:grin:

So I still do not understand how we can continue to deregulate and push for global maketization when our economy is so unhealthy..with out a healthy economy we can not be a global presence at all..I also do not understand how we think generating more debt is going to help an over credited society..

So I vote for buying locally and continuing to help keep our neighbors employeed..buy locally and help America grow again..

 

[powerslave]

So I vote for buying locally and continuing to help keep our neighbors employeed..buy locally and help America grow again..

I agree. We already dump so much money overseas I think we need to spend it closer to home.

 

[jaylectricity]

wow. even though it doesn't actually say that, the number is astounding. it actually says the median sale price is less then $10,000. that doesn't cover existing homes.

Thanks for clarifying that for me. I hadn't thought about it that way.