Friday, February 20, 2009

Grinding to a halt.

I took it upon myself to ask my customers yesterday; "How are things going where you work?"

An extraordinary number of them said they were unemployed or laid off.

These were people who were actually buying something, making me wonder if its the last drips of water out of the faucet after the water has been turned off.

This is especially startling to me because this is the time of year when people would ordinarily be thinking about gearing up for the spring building season. Landscapers and outdoor stuff. More tourists.

It was also very quiet for the first half of the day. Closing my eyes at my desk, I could hear very little car traffic or conversation outside.

I've also noticed that I've gone from being the most pessimistic person in the room, sometimes ludicrously so, to almost the most sanguine person in the room. It's like the barometric pressure dropped around me.

Lots of commiseration going on.

Everyone, but everyone is finally aware, and willing to admit that things aren't going all that great.

Ordinarily, this might be a sign of the bottom. But....

I was telling my wife this, and she said, "It's funny how everyone thinks you're the pessimistic one and I'm the optimistic one. I think it's going to get way worse. Who's to say it can't keep going down?"

Anyway, this is the most anecdotal of of evidence.

And a short snapshot of time.

But there it is....

23 comments:

RDC said...

People are looking for the bottom and the turn around. I feel that they will be disapointed.

This still has a long ways to run. Debt levels are still very high. The losses in perceived wealth due to stock market losses and home value reductions are still not real to a lot of people. Job losses are still building.

I would plan for it to get worse befor it gets better.

tim said...

It ain't over until credit cards stop working for the masses.

Anonymous said...

I have noticed even in my own associations, with other retired who were very well settled in recent years in Bend to be now panicking. Dozens of people who retired here that I know in the last ten years are now considering 'walking' from their Pronghorn or Brasada lots & cabins. They look at their 401k being down 1/2, and retirement is not as planned. The investments are not just under-water like the home at BT, ... but the Prongy investments are bend-gone. I have just started to see this from my 'rich' acquaintances complete panic. The realization that virtually ALL their retirement plans have been destroyed. Forever.

Then at the digs say Deschutes, virtually everybody at the bar is now out of work, painters, ... you name it NOTHING no work. Zero. School teachers still have a job.

I notice the faces everyday of people, and they just look sad. Yesterday I stopped for a burrito at taco-shack, and the place was like somebody died, there were a few people in there but the staff just looked pathetic.

Food prices too are going up noticeably what I used to get for $20 at TJ, is now $35, that has got to be hurting people with little to no income.

A recession is when the neighbor doesn't have job, and a depression is when you don't have a job. Real un-employment in BEND feels like 25% right now.

People that were drinking $50/bottle wine last year are now buying 'box-wine'.

The only kids that I talk to that have jobs are Hoodoo MT-B, but that season will soon be over, lets see how golf picks up this spring.

Retiree's will exit, as they have to go back to work. The working poor will go to PDX where there is work.

Yes, dunc its like just the last few weeks, but I think its the Feb 15 tax statement, 2nd installment on property tax, people see the losses. What surprised me most was the sheer number of people that I have known for years that never mentioned their Pronghorn investment, people with money that openly talk about just letting it go, all these STD remote resorts are simply going to collapse to zero. The greed that so many people put good money DOWN into these investments and have fed them post 2006 for so many years and through so much good money, and now have completely given up hope.

The difference between the street and the BULL&SORE is simple amazing.

Duncan McGeary said...

See what I mean? It seems like a year and half ago you were telling me I was being too negative, RDC....

Anonymous said...

Tim,

The credit card is about there, I'm seeing complete fussing with cash now, its obvious to me that the 'card' is max'd out today.

What kills me is that all the money machines downtown want $3 for a $20, even if your on the exchange. I get most my cash from Newport, but I hate to give a card to an open-bar, too many times have I paid for something I didn't order, so I prefer cash, unless I'm dining.

But I honestly think that here in Bend the card is now dead, and I see the cash running low to zilch in a month, what this means is that even the busy places will see a slowdown.

It's surreal, max'd cards, nationalization on the horizon, which means 'bank-holiday', and yet people are living with $20 in the wallet.

Somebody better get a fucking BIG soup kitchen in BEND open pronto.

Did you all see next door to Pine Tavern, there is a guy with a cart selling "Bend Recession Pie", its basically a little meat pie, homemade, but I didn't talk to him, but I would have done "bend depression pie', but I guess that would have been depressing,...

Dunc was never 'negative' only realistic, and RDC(BENDBB) was always the bright-light of hope, and now has gone negative, Dunc has always been NED-FLANDERS forever. A cheery rosy voice of hope.

Anonymous said...

The awakening to the Great Shutdown happening has arrived with the new economy taking shape. This process will take a few years and the outcome is unknown. Simpler and making do with less is as far as I will venture in prognostication.

I can pull up my emails over the last 18 months and see how I worked through the emotions connected to understanding this process. I seem to have been stuck at angry for quite a while but am now calm and accepting that life has changed in America. I'm actually hopeful that we can rediscover the basics of family, community, and service to those around us as being a path to contentment.

Hard times has come to visit and will overstay its welcome. Remember the book "All I Ever Needed to Know I Learned in Kindergarten."? I hope we all remember those lessons starting with sharing is caring. All together is the only way we'll make it through relatively unscathed.

Good to see RDC posting.

RDC said...

Duncan,

Not quite. A year and a half ago I indicated that this is part of the business cycle, not total collapse of economic life as we know it. It is still a part of the business cycle. It is the result of over use of credit and the resulting deleveraging which is taking place.

Economic items for which there is no quick fix. The actions being taken to make it a short term recession, are in the end just going to extend the duration of the pain.

Because of the nature of this, while long from the point of view of recent recessions, we are still relatively early into it. As such one can not and should not assume that because sales are just down 20% that it is as bad as they will get. Many people are still thinking in terms of a V shaped recession. As a result they are still spending to some degree (burning through their emergency fund, adding to credit card levels if they can, shopping because they are not working and don't know what else to do with their time, etc.). As the duration continues those behaviors will change.

The model I use for worse case is the Japanese deleveraging event which took 14 years for their market to hit bottom. It was not a collapse of everything economic, it was more of a gradual malaise that wore things down over time.
While it will probably not be 14 years and a drop of 80% of our market. It is not going to be something where it is going to end quickly.

The consumer is not going to be the big driver coming out of this one because they have too little savings and too high of a debt load. Those are going to have to change before this is over. Attempts to create false recoveries by trying to drive spending will just set us up for the next fall.

Anonymous said...

RDC has no choice to post here, now that he mandates registering and IP monitoring on his BEBB site, he has all but killed his site.

He comes here because he's comfortable in Dunc's 'moderated' world, and fears life in places like BB2 where anybody can speak his/her mind.

People like to focus on de-leveraging, and it is correct last fall everybody that had gold or oil was selling to raise cash.

The USA is NOT japan, japan is a US colony since WWII and was forced to follow the IMF ( US treas/FED-RES ) rules, that led to their prolonged stagnation.

The USA will NOT do a JAPAN, the USA will did what it did in the 1970's they'll print their way out of the mess, and then Volcker will create 20% interest rates which will bring the world back to the worthless dollar.

The USA is a do as I say, not as I do, the USA will never do what Japan did in the last twenty years. Japan was forced by the IMF to fuck itself.

I'm seeing food up 50% YTD, yes there is de-leveraging, but not on essentials.

Once the majority have sold off their assets ( gold, oil, ... ) to raise cash to live, then the de-leveraging will end for the individual. Of course the BANKS sitting on negative net worth, and the companys negative net worth, they'll all be cleansed.

Because of peak-oil, energy will continue to rise, the last 20 yrs Japan may have been 'bad' but at least they kept jobs, today japan is a real mess with homeless now becoming an epidemic, the USA should be VERY fearful, for this is exactly how HITLER came to power, by letting its colony's become destitute the USA is creating tomorrows monsters.

I'm bullish on BEND 5+ years out, and I think Bend can be 'fixed' today. The USA still has the most guns (nukes), and most people in prison, and the most military occupation in the world, and the USA will continue to rain war down on oil country's that don't trade in dollars.

Duncan McGeary said...

"RDC has no choice to post here, now that he mandates registering and IP monitoring on his BEBB site, he has all but killed his site."

I don't believe it's his site, per se.

BEBB will be good for house prices, at least.

But, yeah. Seems to me the volume of posting has gone way down. Wouldn't know about viewer traffic.

I think a moderated site that doesn't censor much is the best of both worlds. A Benevolent Dictatorship, if you will.

Um, Buster. You don't want to read the Source today. You wouldn't find it....interesting...just pass on by, nothing to see...

Anonymous said...

I don't believe it's his site, per se. - Ned


RDC registered within 5 minutes of the sites (BEBB) creation.

BENDBB was the creator and admin, but RDC was the first registered user.

This kind of thing is never happenstance.

It's good that he's here and we can rub shit in his face, as he would never tolerate such in his own virtual world.

Anonymous said...

I always read the SORE picked up a copy yesterday while having lunch at taco-shack.

What specifically? Hell the content that came out on the new printing yesterday was all online since monday.

There wasn't a single thing in the new version that I hadn't already read online. I always pick it up on thursday to see the music line-up, and as always its going to suck.

What did you find interesting? The article about toxic nuclear waste in Yucca?

HBM is slowly coming over cuz he knows he's bailing. The SORE is owned by Switzer who does almost all the 'events' and his main patron is MDU/MOSS who has ran our MUNI-DEBT to BK. Yes, we need more story's about Yucca in the SORE.

Hell just today I begged the Bruce to start a 'Bend Gazette' online news.... There will never be change from the BULL&SORE both owned by the same boss-hoggs.

Don't get me wrong, I like Mike Hollern on a personal level, and I never call anybody good or bad.

I just hate to see the city looted for $200M (MUNI DEBT) so that MDU-MOSS can keep Knife-River above water.

We need a real newspaper in BEND, and bad, as never before, like todays BULL story from Capell on Juniper-Ridge, just covering his ass and why not? In two years they spent $30M (taxpayer DEBT) on having knife-river move dirt and capell is related to taylor-nw, which is now part of knife-river which is owned by MDU, which is directed by MOSS, who is prez of the bank of BEND.

Wes said...

Hi Dunc,

There's an interesting article in Newsweek about a study that correlated pundit's predictions with reality. The study found that the more certain and absolute the prediction, the less likely it was to be true. The results also showed that there was an inverse relationship between a pundit's celebrity and his/her accuracy.

tim said...

It's going to be the 30 & younger crowd most shell shocked (because they have never seen life without credit cards) but boomers most screwed (because for so long they have had an certain expectation of their retirement, based on their parents retirements).

Leitmotiv said...

The way I see it Duncan, your position/s make total sense. See, your business has been around 28 years and you saw this coming. That was the reason for pessimism.

Because you prepared for the bursting bubble, you came out stronger once the recession finally hit. So, that leaves you ahead of the game a little. That's where your sanguinary mood comes from, is your attitude of forethought.

But if you too start to feel the pinch, you may change your tune.

Duncan McGeary said...

"...but boomers most screwed (because for so long they have had an certain expectation of their retirement, based on their parents retirements)."

I resemble this remark.

I'm going to make an IRA contribution next week (now that the lease is secure), and tell my Financial Guy (sounds important, huh? More like, my parents financial guy....) to put my pitiful IRA savings into the stock market. It's been cash until now, and as the guy said, cash hasn't been a bad place to be....

I'm going to encourage my wife to do the same thing. May not be a stock market bottom, but we have 10 or 15 years to wait for it...

Duncan McGeary said...

"What specifically?"

Never you mind.

Pay no attention....

Duncan McGeary said...

Wes,

Statistically, someone is going to be right.

Duncan McGeary said...

"But if you too start to feel the pinch, you may change your tune."

It may sound cocky, but I used to say, "If I'm feeling it, the other guys are feeling it worse..."

I'd find out six months later.

But I'll resurrect that saying. If I start feeling it, that means it's really bad for everyone else.

I think there is a pretty good chance of that

RDC said...

Duncan,

Suggest you average in, not move all in at once. Also split your investments such that your equity portion should be around (100-your age)% or your total investments. Then rebalance periodically with that approach in mind.

It is almost impossible to time the market over any length of time. At this point we are likely to see more down side. On the other hand we might not. Thus the reason for averaging in.

RDC said...

Duncan,

As far as volume over at BEBB, the total number of posts are down slightly. Those that were contributing content before are generally still there. Some that posted anonymously have now registered.

The posts that were primarily garbase, obscene or were rants of of one kind or another have stopped (which is the reason why BEBB put the change that required people to select usernames into practice in the first place.)

Duncan McGeary said...

It's a minimal amount of money, RDC. Maybe half now, half later....

Bewert said...

Hey, Dunc, hb picked up my story on the Bulletin funding the local Chamber PAC and then editorializing for their candidates:

The Money Trail Leads to Some Strange Places

Mrs Sally Heatherton Esq said...

Dunc isn't cocky, he saw it coming, most saw it coming. The good thing about small biz, is they can't lay you off, dunc did the right things and cut-back, and now there are no surprises, well the surprises could still come, people could in theory quit buying comic books, but if you study the great depression, you realize even at the worse folks found a nickel to sit in a theater to be entertained.

Dunc is flexible he'll see the coming depression fads, he can respond, he'll be fine.

It's the people with 'jobs' that are fucked.

Congrad's to bruce having hbm post his post in the SORE, now if you both could just beg folks in BEND to take action by demanding the governor to force the sec-of-state to audit the CORA & COBA books and make them prove that the $100k actually came from 1,000's of unemployed realtors and dry-wallers.

Congrad's to dunc, 22 posts in one day, and not one from buster or homer.

Smart un-employed people will start their own biz, like in 1983 the worst of times in ORYGUN 25 yrs ago today, ... laid off, start your own biz, become your own boss, and never ever again get laid off.