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The 2014 Black Friday Shopping Massacre

Sprott Money's picture




 

 

 

Jeff Nielson for Sprott Money

 

 

It is no secret to properly informed readers that the U.S. economy is mired in a Greater Depression. All claims of economic growth and a “U.S. recovery” are nothing more than a flimsy fraud. This fiction requires nothing more than lying about the rate of inflation, as all estimates of GDP are directly derived from the official rate of inflation.

 

US Black Friday Sales
black-friday-sales

Lying about the rate of inflation is an activity which comes more naturally to the central bankers and our corrupt governments than breathing. While soaring inflation (particularly food/housing costs) cripples the standard of living for the Working Poor and the shell-shocked remnants of the Middle Class; the Liars report near-zero inflation, and lament that inflation is now “too low”. All that is missing are the crocodile tears.

 

 

What needs to be understood here is that this Great Inflation Lie pollutes/distorts most of the economic propaganda, what these corrupt governments call “statistics”. Nowhere is this more obvious than with respect to the grossly fraudulent reporting on “retail sales” and/or “consumer spending”.

 

 

Neither of these so-called statistics is ever deflated by the rate of inflation. This was true even back in the years when our governments weren’t trying to pretend that inflation is “near-zero”.

 

 

For those readers who don’t follow the math here; all reports of sales/spending need to be “deflated” by the (real) rate of inflation, meaning that the rate of inflation must be subtracted from these (nominal) sales/spending numbers. A simple numerical example will illustrate this.

 

 

Let’s suppose that the government reports “an increase in retail sales” (measured in dollars) of 10%. But the government also previously reported a rate of inflation of 6%. Thus out of this total increase in dollars (of retail sales), the actual increase in sales was only 4% (10% – 6%). Because prices increased by 6% from one year ago; most of that increase in dollars of sales was merely the higher prices caused by inflation.

 

 

Armed with this understanding; we can now translate the lies of the Corporate media, and our corrupt governments, in this case the annual Big Lie about U.S. “Black Friday” shopping. The official propaganda acknowledges that this year’s numbers are bad, but adds (of course) that once “properly explained”, the bad news is actually good news.

 

 

Consumer spending during America’s Thanksgiving weekend dropped compared with last year, but the decline can be attributed to an improving economy and changing shopping habits, a survey found Sunday.

 

 

Now observe precisely the same information being reported by a media outlet outside of the mainstream monopoly.

 

 

Even after doling out discounts on electronics and clothes, retailers struggled to entice shoppers to Black Friday sales events, putting pressure on the industry as it heads into the final weeks of the holiday season.

 

 

US Employment
jobless_us

Spending tumbled by an estimated 11 percent over the weekend, the Washington-based National Retail Federation said yesterday. And more than 6 million shoppers who had been expected to hit stores never showed up…

 

 

US Debt

 
US_debt

 

Doesn’t look nearly as pretty without the Corporate media’s sugar-coating, does it? But it looks much worse once we factor inflation into this equation, to produce a real estimate on 2014 Black Friday shopping.

 

 

Back in the real world, where people regularly eat food (especially in the Obese States of America); inflation is somewhere close to 10%, if not above that. Even though the nominal sales figure here is already a negative number, we still must subtract the rate of inflation from it, because this nominal number is still measuring the increase in prices from 2013.

 

 

When we subtract a realistic estimate of inflation, once we get even close to 10%, suddenly -11% becomes -20%. Black Friday shopping in the U.S. this year plummeted by 20% (or more). In the realm of economics; a year-over-year change of that magnitude is not a plunge, it is a collapse. But even this reporting is still relatively superficial.

 

 

What needs to be supplied here to put this horrific number into true focus is to add context. Specifically, we need to factor-in all of the horrible shopping years in the U.S. which have come before this. This is not some one-year horror story, this is a cumulative, gigantic collapse.

 

 

Since the Crash of ’08 – the final death-blow to an already crippled economy – there has not been a single shopping season where the “increase in sales” has been equal to the rate of inflation. Put another way; in real dollars (i.e. subtracting inflation) retail sales have fallen every year. Every year, U.S. retailers are selling less and less goods in a consumer economy.

 

 

Now, after six consecutive, cumulative bad years (and a couple of those years were also terrible); we see Black Friday shopping plummeting by an additional 20%. For much of the U.S. retail sector; retailers are now selling half as many goods as they were selling before the Crash of ’08.

 

 

The exception to this disastrous trend has been the luxury retailers. With the Fat Cats at the top fatter than they have ever been at any time in history; life is just fine for those selling high-end, luxury goods. But the relatively strong numbers for the luxury retailers are included in all aggregate sales figures.

 

 

US Corporate Profits

corporate-profits

 

This means our “-20%” estimate underestimates the shopping carnage for all non-luxury retailers in the U.S. However, we need to add even more economic context, in order to properly frame this disastrous collapse in Black Friday shopping within the overall train-wreck that is the U.S. economy.

 

 

This is an economy with permanent near-zero interest rates. In even a semi-functional economy; near-zero interest rates would produce such explosive economic growth that a government would be forced to quickly raise interest rates, as the economy would rapidly “overheat”. Six years of near-zero interest rates, and no growth is not indicative of an economy which is dying. It is conclusive proof of a dead economy.

 

 

Then we have oil prices. In the Great Gas-Guzzling Society; the one sure-fire means to trigger an immediate spurt of economic activity/growth in the U.S. was to push down oil prices (through one form of generally illegal manipulation or another). However, in 2014 we have a first in modern U.S. economic history: a plunge in gasoline prices accompanied by a plunge in economic activity. Note the recent headline:

 

U.S. households could save $1,100 from falling gas prices

American households had an additional $1,100 apiece put into their pockets (just in time to all go shopping), and even with all that extra cash there was a nominal plunge in spending of 11% from one year ago – and a collapse of 20+% in real dollars.

 

 

How do we know that the U.S. (consumer) economy is dead? Because the U.S. consumer is dead. And for those of us north of the border; (thanks to Harper the Destroyer) the Canadian economy is simply a sickly, surreal echo of the U.S. economy.

 

 

There is still one more piece-to-the-puzzle which needs to be added here. Regular readers will be familiar with a “prediction” (simple deduction?) made in a recent commentary:

 

 

The Next Crash in 2016

 

Because this orchestrated collapse is specifically designed to be timed with the U.S. election cycle; the Old World Order clearly intends to continue with its inane fiction that the U.S. economy is still “recovering”. This means that even though it is already D.O.A.; nothing can/will be done to strengthen this Corpse Economy – because to do so would mean contradicting their own propaganda.

Not only is the U.S. economy already dead, but we can be virtually certain that the corpse will be allowed to rot for nearly two more years.

 

 

Jeff Nielson for Sprott Money

 

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Fri, 12/05/2014 - 20:54 | 5522540 Abbie Normal
Abbie Normal's picture

Life was a lot simpler in those smaller midwest towns and cities.  Our elderly neighbor used to buy lottery tickets regularly so once I asked him what he'd do if he won.  The surprising yet adorable reply was he would upgrade his old Chevy to a new Oldsmobile.

When we moved there in the mid-90s, a rental duplex with 3bdrm/2bath/garage was $550.  I commented on the price and the landlord apologized that he had to raise it from $500 because of the increase in utilities.

Unfortunately by the time we left, the creep of the Great Recession was starting to be felt there too, with GM part order cutbacks meaning the local foundry had to lay off multi-generations of workers.

Fri, 12/05/2014 - 13:31 | 5521006 falconflight
falconflight's picture

Any idea how much of the agricultural economic activity is tied to ethanol?  

Sat, 12/06/2014 - 01:14 | 5523065 mygameon
mygameon's picture

Falcon,

75% of all corn in Iowa is converted into ethanol! Unfriggin believable but true.

Sat, 12/06/2014 - 08:36 | 5523424 AdvancingTime
AdvancingTime's picture

  The push towards "ethanol" is an excellant example as to how stupid we have become. To all the people who think the worlds surging population will not become a problem because of new energy sources I say, wake up! Anyone with even the slightest mechanical knowledge will tell you that solar panels, wind mills and such take a lot of energy to build and often are maintenance intense.

Both these complicated systems have a short lifespan and require a great deal of energy to be expended in just keeping them up and running. Carry no illusions the days of cheap energy are behind us and not only has the low hanging fruit been picked it has been eaten. Sadly, if we look back we will see much of this energy was allowed to go to waste. The article below looks into the cost of failing to plan long-term and questions if collectively mankind is incompetent.  

http://brucewilds.blogspot.com/2014/12/does-peter-principle-apply-to-mankind.html

Mon, 12/08/2014 - 14:13 | 5529335 TheGreatRecovery
TheGreatRecovery's picture

I read somewhere that the ethanol in gasoline actually doesn't power your car.  Something to the effect that, if you burn 20 gallons of no-ethanol gasoline, you can probably travel as far as if you burn 21 gallons of 5%-ethanol gasoline.  So the ethanol is just "filler".  As is often the case, I can't find a study on this.

In addition, to grow the corn to make ethanol, they take natural gas, distill it, take the ammonia, put that in fertilizer, and put the fertilizer on corn, grow the corn, and then distill the corn into ethanol.  They could could have just used the natural gas in the first place, and not had any of that enormous waste of energy in that super-complicated, many-operation system.

And then if the ethanol doesn't even really power your car, OMG!

Fri, 12/05/2014 - 14:09 | 5521145 Big Corked Boots
Big Corked Boots's picture

And, how much to oil and gas? You're not in ND are you?

Fri, 12/05/2014 - 12:46 | 5520862 overmedicatedun...
overmedicatedundersexed's picture

fowlerja, go ahead and keep supporting the elite criminals of CB's and wall street and finance cities across the globe..i made enough to live ok without going back into the markets..i have PM's because they are holy water to those vampires you support..many of us looked at the corruption of 2008 and walked away..keep investing with them, some of us have had enough. free corzine and fowlerja.

Fri, 12/05/2014 - 12:32 | 5520801 El Hosel
El Hosel's picture

Yeah, butt, its good for stawks.

Fri, 12/05/2014 - 12:25 | 5520775 Bastiat
Bastiat's picture

Porcelain vortex.

Fri, 12/05/2014 - 12:11 | 5520721 no more banksters
Fri, 12/05/2014 - 12:10 | 5520715 JRobby
JRobby's picture

No Demand

The Fed can't fix it

The Fed creates inflation (used to) to serve its wealthy overlords.

This is DEFLATION

Fri, 12/05/2014 - 16:39 | 5521685 Things that go bump
Things that go bump's picture

My hobby is designing beaded Christmas ornaments, and for the last 3 years I have been writing instructions with photos and illustrations that I sell online for other hobbyists to duplicate my designs for themselves. This, of course, is never going to net me a fortune - its a very small niche, but it keeps me in beads. This year I added kits. Sales picked up right after school started, as expected with this sort of seasonal thing, as the ornaments are highly ornate and take a long time to make. I tripled my sales as compared to last year. Then, in the middle of October it suddenly died. After a couple of weeks of very sparce sales I did some research, and the same thing has happened to my competitors (on one site the number of total sales is shown on the shop page and I tracked it). I also noted that most of them had lowered their prices. I followed suit. It didn't really help much. The rest of October, all of November and so far for December business has been quite lackluster at best, and this should be my busy time. People are not going to indulge themselves on such fripperies unless they have a comfortable cushion of disposable income.  

Fri, 12/05/2014 - 17:04 | 5521788 11b40
11b40's picture

The whole "Christmas" themed market has suffered a major decline.  After getting burned for several years, many merchants have cut way back on things with Christmas-specific motif's.  Our agency represents several vendors in the Tabletop space.  Once, there was an abundance of different dinnerware patterns in dinnerware, glassware, etc.  Now, there are not very many at all.  Same with decorative ceramics and other categories.  These things have become a markdown liability, and people simple don't entertain as they once did, either.  Tradition gets trumped by finance.

Fri, 12/05/2014 - 17:32 | 5521829 Things that go bump
Things that go bump's picture

Something happened in the middle of October. I don't know what it was, but something happened. It was like a spigot suddenly being shut off. I'll continue designing ornaments because I'm retired and have the time and inclination. I enjoy the challenge and I've got plenty of beads. I'm a fairly competent technical writer, so I can break down a project into steps well enough for someone else to follow, though I am a poor photographer. It only costs a few cents to put my instructions up online as ebooks on crafting sites, and I am still getting royalties from Kindle (if only a few dollars now and then) for my book. If I don't sell, at least I won't have lost money, but the competition is fierce. I have noticed the narrowing of selection on many things in recent years, its not just the holiday niche.

Sat, 12/06/2014 - 17:10 | 5524289 oudinot
oudinot's picture

Things:  You write concisely, beautifully;  I am confident all of your 'technical' how to's are very well understood.

Sat, 12/06/2014 - 17:20 | 5524304 Things that go bump
Things that go bump's picture

Thank you! What a compliment.

Fri, 12/05/2014 - 21:32 | 5522635 cyberfossil
cyberfossil's picture

Beads and trinkets down, huh?  Yes, that is a gauge of discretionary buying power.  I recall a few days ago that the Zero Hedgers published an article showing even alcohol sales are down--when true addictive behavior is impacted, you know there is a major hole in the recovery theory.  When the only consistent online profitable and addicting sector declines in revenue (online porn), we will know that we have hit the wall.

Sat, 12/06/2014 - 02:43 | 5523176 cheech_wizard
cheech_wizard's picture

My plan B at the moment. If this seems like I'm advertising, my apologies. With all the talk about small business, I thought I'd float this out there.

If anyone is interested in custom cedar furniture, drop me a line. A few people I know and I actually opened our small business last year, and we don't do a lot of advertising, because my partners and I currently do it part time (it's so when we retire, we can have some extra money for beer and ammo...)

We tend to sell what we make locally, and are currently working on three twin beds.

But if you have an idea, you can send us a sketch or a photo, and we will give you a quote. I own a Woodmizer saw mill, so we actually mill all our own lumber. This also saves us a great deal on materials. We are hardly what you would call profitable, generally only selling a piece or two a month, but it does give us some extra cash.

 

 

Mon, 12/08/2014 - 14:44 | 5529281 TheGreatRecovery
TheGreatRecovery's picture

Kudos.  I have tried building furniture and it is not easy.  Real cedar lasts practically forever.  Family heirloom stuff.  And made in America.

Silly thought, but what about rocking horses?  Sell at Christmas time.  Not exactly furniture of course.  No response requested.

Sat, 12/06/2014 - 13:05 | 5523815 Things that go bump
Things that go bump's picture

It'll at least keep you in cedar and you'll have something to occupy yourself with when you retire. Retirement is death if you don't have something to keep you busy. My ex-husband retired a few months ago and does nothing. My granddaughter says he's lonely and miserable and is drinking himself to death - cracks a beer as soon as he wakes up. I doubt he'll last a year. 

Fri, 12/05/2014 - 21:31 | 5522633 cyberfossil
cyberfossil's picture

Beads and trinkets down, huh?  Yes, that is a gauge of discretionary buying power.  I recall a few days ago that the Zero Hedgers published an article showing even alcohol sales are down--when true addictive behavior is impacted, you know there is a major hole in the recovery theory.  When the only consistent online profitable and addicting sector declines in revenue (online porn), we will know that we have hit the wall.

Sat, 12/06/2014 - 04:44 | 5523260 MeBizarro
MeBizarro's picture

Online porn is dead man and has been for a while unless you are in a kinky niche or have a crapload of properties.  Free porn just cannabalized the business. Just look at what has happend with Playboy, Hustler, and their online efforts.  

Friend who works at Google as an engineer and an old hiking buddy.  Google estimates about 20-25% of the bandwidth in the US is still consumed by porn/porn-related although it is dipping a bit as more and more people watching things on Hulu, Netflix, etc.  

Fri, 12/05/2014 - 13:34 | 5521014 neidermeyer
neidermeyer's picture

When WMT loses customers to Dollar Tree and Dollar Tree loses those customers because they are too "pricey" we are indeed in the toilet...

Sat, 12/06/2014 - 13:45 | 5523925 TheGreatRecovery
TheGreatRecovery's picture

Goodwill thrift store, Salvation Army thrift store, Sheriff's Youth Ranch thrift store, Veterans thrift store.

Fri, 12/05/2014 - 16:44 | 5521699 11b40
11b40's picture

Family Dollar is struggling.  Dollar Tree is actually the brightest bulb in the box in the low-end channel.

The battle between Dollar Tree and Dollar General over acquiring Family Dollar is because they both see the writing on the wall.  DOG is afraid of DLTR, and with good reason.  They feel them taking so many of their customers with their true $1 concept, but can't do anything about it.  They see them layering on the newer concept 'DEALS' stores.  Then, when the FDO deal started going down, they freaked.  They were surrounded by true $1 stores on the low-end, and this new, quickly growing chain of stores bigger than theirs catering to the low/moderate shoppers, then...wham!  DLTR is about to buy a big new battering ram and use it to come after them head on with the acquisition of FDO.

You want to know the reason DLTR is kicking butt in this retail space?  Well, it's all about management.  DLTR is run buy a team of merchants who have been in place and working together for decades.  When Bob Sassar took over at DLTR, he brought a team from the old Rose's chain with him.  These boys know what they are doing, and Sassar is a quiet, low-key visionary, and very financially savvy guy, too.  DOG, on the other hand has been bought and sold a few times and run by bean counters - "professional management".

FDO is run moderately well by second generation primary ownership, but they have made a few mistakes and been a little slow to react during a period when a stumble can be fatal.  The son is not the same as the father was, either.  Vision does not seem to be an inherited trait.

This fight is not over, either.  DOG has said they were willing to shutter up to 1500 stores to win approval for an FDO merger.  I have heard that it might take them closing over 4,000 stores to win approval.  What they are willing to give up will say a lot about their level of panic.

Fri, 12/05/2014 - 13:01 | 5520914 KnuckleDragger-X
KnuckleDragger-X's picture

They are running on conventional wisdom which are really old wives tales for the market. They repeat what they've been told without ever looking at the raw numbers themselves and then are surprised when things don't go as planned. Today the market is orgasming on the jobs report without bothering to look at the underlying numbers that are actually saying that most of the jobs are low-paying and part-time but they admire the shiny parts.

Fri, 12/05/2014 - 14:38 | 5521249 Baa baa
Baa baa's picture

Yeah, federal job numbers are full of more crap than a feed lot, same with earnings and inflation.

I guess that guy that says no inflation, hasn't checked the quantities of all canned and packaged goods shrinking to keep the price steady. The list is endless, I cannot fathom some believe this is a recovery. There is nothing to recover with, it's all used up or owned by someone else.

I do not know how to hold it up, does anyone?

Fri, 12/05/2014 - 15:46 | 5521454 Ying-Yang
Ying-Yang's picture

If everyone could see it like we do, we could all go local. Small local businesses, credit unions and so on.

The problem is most folks don't understand big companies are the problem.

Fri, 12/05/2014 - 16:10 | 5521550 KnuckleDragger-X
KnuckleDragger-X's picture

The big corps don't know what they are doing either....

Fri, 12/05/2014 - 14:39 | 5521248 Baa baa
Baa baa's picture

yep

Fri, 12/05/2014 - 12:58 | 5520881 11b40
11b40's picture

Exactly.....just pushing on one end of a string.

This is what most of us who had their finger on the economic pulse were saying 5 years ago,

My customer base for the past 35 years has included some of the largest retailers in America, as well as Mom & Pop's.  20 years ago, our agency had almost 2400 accounts, and 16 people.  The attrition has been steady since the peak in the late 90's, and today, there are just 3 of us handling primarily larger retailers.  Our account base is now down to about 50.....and the trend line is not improving.

I have been through so many bankruptcies, I can't even count them all.  Several, like Best Products as an example, went through it twice.  Many of the small business owners and the buyers for larger chains became personal friends through the years, and it has been depressing holding their hands as the struggled to hold or re-build what they devoted so much of their labor and wealth to.

Springsteen nailed it long ago ... "these jobs are leaving, boys, and they ain't comin' back."

Watch it and weep.

https://www.youtube.com/watch?v=77gKSp8WoRg

And for a li8ttle weekend entertainment, listen to the whole Born In The USA album.  Here is another great one about the middle class life slipping away.

https://www.youtube.com/watch?v=utVR3EgQkHs

Fri, 12/05/2014 - 12:58 | 5520899 Doctor of Reality
Doctor of Reality's picture

I'm closing my practice Dec. 30th. I'm done sinking assets into a dying business model. 

Fri, 12/05/2014 - 13:24 | 5520992 neidermeyer
neidermeyer's picture

My fathers internal med specialist joined the regime (Veterans Admin) about 10 years ago to gain traction against forever rising amounts of paperwork and liability and to ditch the expenses associated with a private practice... If I was a doc I'd set up shop in the caribbean...

Sat, 12/06/2014 - 03:29 | 5523198 August
August's picture

My contacts in American medicine tell me that when private practice groups (who are now generally tightly alligned with a hospital system and/or an insurer) hire new docs, most of the new hires have zero interest in buying a share of the operation.  More paperwork, more meetings, more responsibility for no dinero.  Put simply... why bother?

Owning your own practice used to be the Holy Grail of American medicine, now it's just an albatross/dodo/dead duck (take your pick).

Sat, 12/06/2014 - 04:53 | 5523265 MeBizarro
MeBizarro's picture

New hires (especially females docs) wants 40-45 hours, no weekend hours, and a salary.  What is ridiculous is that these same docs whose productivity takes a notable hit then want to get paid the same as their private practice counterparts when they do 20% less work and work 10-15 hrs less a week.    Owning your own practice is still the way to really make a mint and docs (especially any kind of specialists) who complain about wages are insane.  

Yeah they have tons of loans but any specialist is north of $200k annually with essentially zero unemployment and can make a mint on the side doing other industry-related issues.  Yeah it is hard and increasingly difficult to get into US medical schools and the Step 1 and Step 2 license exams are becoming even tougher but it is still a golden ticket to earn a living in the U.S.  Any physician who tells you different is either a liar, has huge spending issues, or a legit bleeding heart who runs a chartity practice which is almost nonexistant today in the US.

Fri, 12/05/2014 - 17:40 | 5521921 Abbie Normal
Abbie Normal's picture

And one of our close friends, a family doc for almost 30 years, has closed his practice and started working as a prison doc.  At least the hours are better and he doesn't have to wait 6-9 months for the HMOs to pay up.

Sat, 12/06/2014 - 14:00 | 5523957 TheGreatRecovery
TheGreatRecovery's picture

A close relative's family practitioner MD closed his practice earlier this year.  I think he's going to work for one of those walk-in medical clinics.

Sat, 12/06/2014 - 16:50 | 5524251 Son of Loki
Son of Loki's picture

Docs dropping like flies.

Mon, 12/08/2014 - 14:43 | 5529252 TheGreatRecovery
TheGreatRecovery's picture

He will miss him.  He was super professional and also polite, kind, and generous.

Fri, 12/05/2014 - 13:11 | 5520952 11b40
11b40's picture

I hear you, but I'm trapped.  We had almost a total wipe out in 2008-9, as the vendor community freaked out.  One of our biggest lines went bust and stiffed us for 6 figures, and 2 others took the line away and replaced our agency with their own in-house sales reps.  Long story short, I could have walked away and retired comfortably at 61, but didn't want to.  Between 2009-2011, I took no income out of the company, downsized like crazy, and set about re-building.  In hindsight, I should have quit, but I'm too stupid, or stubborn, or my ego is too big.  Whatever, but now, I will probably be working as long as I can.  Fortunately, I enjoy what I do, and turned cash flow positive in 2012.  It won't ever be what it was, but I will get by. :)

https://www.youtube.com/watch?v=wS087xt-4EQ

Fri, 12/05/2014 - 22:35 | 5522807 are we there yet
are we there yet's picture

Thank you. Your story, company, and age mirror my own exactly.

Fri, 12/05/2014 - 19:04 | 5522203 FredFlintstone
FredFlintstone's picture

You do karaoke?

Fri, 12/05/2014 - 15:31 | 5521396 Ying-Yang
Ying-Yang's picture

The first sign is when you decide to take no pay.

Alarm bells should have gone off. If you don't pay yourself it is a lost cause. Hope things improve for you!

Fri, 12/05/2014 - 16:17 | 5521590 11b40
11b40's picture

Thanks, and I agree, but what do you do when you are healthy and active at 61?  I started working retail in college, rose through the ranks of a major Dept Store chain, and started my own sales agency at 30.  There were many ups & downs along the way - unbelievable highs at times, but also a couple of periods when I wasn't sure I could make it.  What happened in 2008-9 was the worst, but still I saw it as just another bump in the road, never dreaming the way back would be so long and hard.  I know my business, my market, my customers, and we have an excellent reputation in the industry.  At first, I figured maybe 12-18 months, but there hasn't been a business storm like this one in my lifetime.  It may be clear in the rear-view mirror, but hard to see through the windshield in a shitstorm.

Eventually, I was trapped, as I noted earlier.  Failure is not an option, and after escaping a showroom lease and an office lease, moving the office once, then finally converting 1/3 of my house to offices, I am making money again.  In fact, with my wife as my office manager and my partner semi-retired, I am enjoying not having any other employees to worry about and working from home.  Eliminating the showroom not only saved me a ton of money, it also cut my travel schedule considerably.  I should have done it 10 years sooner.

Using my little company as an example, the showroom and offices were over 75K/yr in rents that no one collects now.  The 6000 sq ft bldg we leased for over 20 years is still empty, and has been since we left it in 2008.  All the employees are gone, along with about 500K in payroll & commissions that used to get circulated.  The hotels and restaurants that once got a large amount of business from us as we traveled extensively now get far less, as do the auto dealers, and on and on.

Through a lot of hard work and a little luck, my personal downward spiral has been reversed, but our country's has not.

Fri, 12/05/2014 - 17:38 | 5521913 Abbie Normal
Abbie Normal's picture

Know how you feel, our business will NEVER return to pre-2008 levels.  During the start of the Great Recession, over 40% of our and our competitors' sales evaporated.  It has been a struggle these past five years to grow it back by 20% and all signs point to it having already peaked, so we're preparing for another sharp downturn in '15.  Looking at financials from '06 is like looking into a different world -- revenues down, payroll down, but expenses like energy are up by 50%

Fri, 12/05/2014 - 18:44 | 5522115 El Oregonian
El Oregonian's picture

But, but, but "Honest" Joe Biden said a couple of summers ago that that we were heading into the "Summer of Recovery"! no?

http://www.politico.com/news/stories/0610/38654.html

sarc off//

Sat, 12/06/2014 - 16:40 | 5524238 Son of Loki
Son of Loki's picture

My Dad, Father Loki, wears 100% cotton dress shirts when he goes to impotent meetings (like funerals and weddings). So his son, Me, buys him a couple of those 100% No-Iron nice shirts every year. Let me tell you, cotton is going thru the roof. Those 100% cotton shirts have increased just about $5 every year for the past 5-6 years; for example, this year, $70 [and/or more] compared to last year of $60-$65 smackers.

 

The year before that about $50 … and so on ….

 

Food, insurance, property taxes, utilities, maintenance, COTTON, and many many more services and commodities have sky rocketed the last decade while wages have been cut at worst, or stagnant at best.

 

It’s no wonder sales were Bust for Black Friday despite Bookoo discounts, ultra cheap gas, cash backs and incentives.

 

What's really sad is how depressed everyone is these days during the holidays. I've never seen so many depressed people here before.

Fri, 12/05/2014 - 13:03 | 5520921 overmedicatedun...
overmedicatedundersexed's picture

doc, but but but ACA is solving all your problems - you can't quit,

Fri, 12/05/2014 - 11:34 | 5520567 fowlerja
fowlerja's picture

Guess I should have bought the Sprott Gold Fund 3 years ago and just lost 40% of my money instead of suffering through this depression...

Sat, 12/06/2014 - 08:53 | 5523434 lester1
lester1's picture

Wow did Ronald Reagan TRIPLE the national debt?? Not even Obama has Dont that !

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