The People Have Spoken, “The Recession is Here”


Yes, my friends, I know that you have anticipate that I shall indeed ramble on about our current recessionary economic climate yet again at this time and place. One thing that I have found that holds true in our economy is the power of numbers. When enough people buy into an idea, it often either becomes true, to some extent, or is being ignored by experts. And, even when learned economists deny it, the truth of the current recession is obvious to millions of people

As widely reported in a number of polls, about 75% of Americans polled have come to the conclusion that the US economy is either already in a recession or will be in one by election day. It appears that the only ones who’re still in denial about a recession are ivory tower economists or those will something to sell the naive investor.

The gloomy poll results shatter the hopes of those who had said that there would be no recession and, who, in face of new evidence, said that there will be a soft landing but no recession and who are now predicting a short and mild recession. When one begins to analyze the poll data with an educated eye it becomes completely obvious that the current economic downturn will be considerably worse than what had been forecast by these so called experts. It shall indeed become a severe recession by the end of the year.

One glaring thing that you will see in the recession poll data is that the majority of people are significantly cutting back their spending because they have no doubt that a major recession is in the cards for 2008. This means that you, as a small business owner, must work harder to convince customers to purchase from you this year as recession concerns weigh heavily upon them.

Some of you may think that I am down upon economists. No, I am not. I just believe that they are too isolated from the real world to make good decisions from their data. Those of us in the trenches of small business know all too well that a recession is underway. As more and more of the general public grasp this fact we will see a much sharper downturn in the economy than was predicted by many.

Here is the key as to why us small business owners know that the recession of 2008 has started. When you look at economic data since 2006 it becomes clear than consumer consumption is what has been holding up the economy. Now, with the housing market meltdown, the consumer spending spree is coming to a close. What’s next? It doesn’t take a PhD to see it, recession!

Another important bit of data is that like consumers, major corporate CEOs are also seeing a recession on the horizon. As their concern rises they will begin to layoff workers, as they should as good business people. Our problem is that the increasing unemployment and uncertainty will spell lower incomes and potential economic disaster for small business owners.

Another consideration is that the personal economic condition of millions is also drifting downwards. Nearly 20% of credit card payments are behind and this number is growing. Over 10% are having problems paying their housing costs. 25% of Americans fear that they will lose their job in the next year. Trouble paying bills and job worries means cutting back on purchases and this is money that will not be spent with our small businesses, thus fueling the recession flames.

Here are the five major factors that people believe are causing the current recession and the trend toward stagflation:

  1. Housing prices rising coupled with questionable credit practices
  2. Tightening of the credit market
  3. Increased energy costs
  4. Increased food costs
  5. Offshoring of jobs creating job security worries

This entry was posted on Saturday, December 2nd, 2017 at 8:46 pm and is filed under Recession. You can follow any responses to this entry through the RSS 2.0 feed.

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