Saturday, March 7, 2009

The Economy and hardships~~a brief note~~~

Hello Darlings,

I know --- it has been a long time since I’ve last posted but, well darlings, with all the sudden changes in the stock market, the economy worsening, President Obama’s stimulus package, the foolishness being done at our State Capital (God Bless you, Maldonado), I just could not fathom what was going to happen.

My “Business Ladies Who Lunch” and I have been having meetings every Sunday just pouring over what is happening, two of the dear ladies have been downsized and are now seeking new employment.

My father once said that “We are not in a depression unless it has gone for 36 months, if it has gone that long and there is No sign of improvement, then we are in a depression.” But I fear that my Father’s assessment time frame may have been a bit too long, with employment in California at 10% and possibly going higher, the threats of furloughing workers and thereby shrinking their pay check will not stimulate the economy. And this has happened very rapidly, almost at the time the housing market had burst.

My ladies and I agree that the worst culprits are the CEO of major corporations, and banking institutions for unsecured loans, outsourcing jobs to other countries, taking huge payoffs, bonuses and separation packages and well as ridiculous spending has placed the economy in dire straits.

Then to discover that some of the higher positioned California State Staffers have used tax payer money to travel to things like a Justin Timberlake concert is completely reckless and reprehensible, I and my Ladies have written and sent a group letter demanding that the Governor force those who have done that illegitimate spending to completely repay the monies that they’ve illegally spent. To put it simply we are furious!

The best way to start improving this situation is to bring back the jobs that have been outsourced overseas, to encourage manufacturing in the United States, to inform the Unions that they cannot demand higher wages but can encourage safety procedures and legal conduits if there are improper situations, to demand higher wages would imperil the businesses, that banks work with homeowners to renegotiate all loans are a much lower and properly affordable interest rates. And banks should be the ones to encourage people to buy

Of course it would be best for people to spend less and more wisely, and to cease being a throw away society. Being “green” is fine, recycling is fine, being thrifty is fine, but not at the cost of businesses, and jobs. Also make our goods absolutely highly desirable by foreign countries so that we are selling much of our goods overseas, but keeping them very affordable here.

The March issue of U.S. news and world report has several articles that are worth reading and Mort Zuckerman’s editorial is well worth reading---his comment that “it’s a chicken and egg problem: the banks aren’t lending because of the weakening economy, and the economy is weakening because the banks aren’t lending” is really part of the crux of the problem.

And the only one who can break this cycle is really the banks, they need to lend to start the healing process but they need to do it at low interest rates to make the loans affordable and worthwhile. People are really seeing what they can and cannot do but they have to remember that they can’t spend like they use to, but only the banks can start the healing process and the CEO’s need to see that, forget what the stock holders want, get the healing started.

I for one have always thought that the way the stock markets were climbing was another bubble that would burst, so instead of buying the stocks when the rates were climbing to exorbitant rates I instead took the money and put it into high earning bank accounts, now the earnings have dropped but I have not lost my cash, it’s still there, maybe earning much less but there and I’m still have enough to cover all my expenses.

So I’ll be spending less, so what darlings, so what. I can still live.

Now my two ladies who lunch, one has moved back with her parents and has put her condo on the market, now she bought it a long time ago, so even what she gets now will still be more than what she paid for it. And she saw that her aging parents did need her, so she is looking for a job that is part time to cover her medical and dental costs and insurances, she did pay off her credit cards and is avoiding using them, she has also done other cost cutting measures so she is doing well.

My other lady who lunches has also done serious cost cutting measures, manage to sell off some property and used that to pay off the balance on that property and her credit card debt, she currently has COBRA on her medical, her working daughter has moved in with her and gave up her apartment, it was good really as her mother’s house is much closer to her work, and her mother’s house loan is fixed and affordable. My lady is also looking at various jobs and other options, and is being very creative. She has 5 interviews lined up and granted it will by at only ½ to 2/3 what she was making originally, but that is not an issue for her and any of the jobs are really a good fit.

It really being able to pay the bills and buying groceries and with the two of them living together it is really more viable by pooling their incomes together. As a matter of fact many families are doing that now and it is paying off for them as well as being supportive. In many ways we are returning to the solid roots of our grandparents of the early 1900's to 1930's, where every penny counted.

Really a attitude that should be regenerated into our young people all over again. All those old addiges "Waste not, want not", "a penny saved is a penny earned" and many more which our young people have totally disregarded which they are finding out to their own sorrow. "WAKE UP PEOPLE---THIS IS REALITY HITTING YOU ON THE HEAD".

So we shall see If our young people learn from this or will they go back to their "bad habits".

For now I’m going to the White Elephant sale today with my family and Juanita, who knows what items I will find, but it pays to be choosy Darlings and remember, it’s a tax write off.

Until anon, kisses Darlings.