Monday, September 13, 2010

Still Collapsing

Talked to dad on the phone today. There's a double wide in his park in Florida going for $3,000. The guy would take less. He was rebuilding it. Stripped it down to the studs. Put in new drywall and new floors, then gave up on the job. Not only is the guy asking $3,000, he's leaving behind about $1,500 worth of tools. Don't expect housing in Florida to bounce back in the short term. Someone could move in, finish the job, and live darn cheap. At this give away price, it's not selling. This is a nice park: huge live oaks, manicured lawns, ponds, swimming pools, recreation centers, and other niceties.

There's a lot of toys for sale. Lately, I've been checking out the used sailboat market. Prices are dropping -fast. Oh there are plenty of boats asking top dollar. Most likely the owners owe money on it and can't drop the price lower. It's funny and sad at the same time. I'd be looking at at similar boats going in the 3,000 - $4,000 range. Then there'd be the occasional boat, little different from the rest, asking $12,000. Apparently, he didn't get the memo. No one's buying toys right now.

Cash is king. Loans are hard to get.

So we have deflation in things like houses, boats, used cars, motorcycles, RVs, and electronics. What is increasing in price is food. They are being sneaky about it. When is the last time you saw a one pound can of coffee? Most often they are in the 12 oz range, or less. If it wasn't gardens and Farmer's markets, fresh veggies would not have been a big part of my diet this summer. So things we can live without are going down, and things we need are going up. Not a good mix.

How about unemployment? Anyone actually believe the government numbers? If you do there's a bridge in Brooklyn that might interest you.

I've friends with experience and education who've been out of work for months. Others are working for a lot less money than they used to. People who used to be able to work all the overtime they wanted are now lucky to put in 32 hours/week. Until the regular Joe starts taking more money, in real uninflated dollars, there won't be a recovery.

It's entirely possible, likely even, that the economy will never be the same. Eventually things will stabilize and it will be the new normal. However, my guess is that it'll be a lower level that what we had before.

Collapse is an uneven business. Some things take a small hit. Other's go right down the drain. Even in a downturn, there are people who do well. Some parts of the country will turn in to ghost towns, others areas may even boom. Overall, however, there seems to be a downward trend. The highs are never quite so high but the lows drop lower.

On the bright side, if I time it right, I might be able to get a sweet little sailboat for a song. Then if things go really well, I won't have to sell my house and live on it full time.



  1. Sixbears,my area not doing as bad as some.But you are right if you have cash there are some real deals around.I hope all of us get to ride the crash down instead of it falling on us.Good luck Bro!


  2. Yeah, there are definitely regional differences.

    Among the people I know, 32 hours a week counts as unemployed. That's the hours you work on your second job.

    There are people whose industries have taken a hit, and who won't be able to work doing what they used to do, but there's plenty of work. Sucks if you've spent 20 years reaching the top of the pay scale in your field to find out it doesn't increase your pay at Starbucks.

  3. Although, overtime at the primary job has dried up, so even if you do work the second job, that's only straight time. We are working more for the same, or even less money. Hardly a glorious workers' paradise.

    That said, do you think this is really worse than the late 70's? Energy crisis, crime, squandered international respect and influence, the rise of the Ayatollah in Iran, foreign economic powerhouses passing us.

    History doesn't exactly repeat, but it often rhymes.

  4. In the late 70s I was looking for a job. Things were crappy here, but the rest of the country looked better. Now the pain looks more widespread to me.

  5. I wish I could remember where I saw it: someone posted a list of all the really dumb things that the Carter Administration did.

    1974 was the year that world growth flattened out, and real incomes began to sag in many places. I think the late 70s felt worse, but we are in much worse shape today.