Recession! Yes Or No?

MoneyNews - Recession Uncertain, says NBER Economist

According to NBER's latest report in August we still aren't in a recession yet using data through June.

What's a Recession, Anyway?

You can say the "definition for a recession has not been met" but even to economists are now questioning the validity of that definition.

You can make one political statement after another - and accomplish nothing. You can proceed as usual assuming that only those "on the edge" or whatever are having a problem and pay little attention to the economy because it won't affect you.

You can also hit a wall called "reality" - as 25,000 Lehman employees did this week.

Some top economists are no longer conjecturing about whether we are "in recession" (leave that to the politicians) - they are now saying we may be in economic freefall. Anyone who doesn't see what's happening in the marketplace probably isn't paying bills or buying food and necessities.

One restaurant here put a sign up this week - "closed due to bad economy". Guess the bad food and rude service had nothing to do with it?

Small businesses that provide necessary services and products at fair prices are doing OK here. Nothing else is. Larger retailers and high end stores are almost empty of customers. Food costs have risen an estimated 9-15% in this area alone. One rather odd effect here is that the traditional money-saver known as WalMart is not doing all that well while the few remaining smaller groceries have adapted more quickly to providing lower cost food staples and have increased their business.

What happens when winter hits and people are hit with fuel costs they can't afford? Will they get a bailout? Probably not.

Point is - we are not facing one or two economic problems. We are facing downturns and crises in many sectors at once. No one seems to know where the bottom is - and once we reach it, it will be years before we've recovered economically in this country.

If you understand the impact of what is happening on wall street and in the oil markets internationally, you can plan your business to fit the current reality and sell products people must have. Those who profit with their online businesses will do so because they provide value, good service, and keep their operating costs low. Those who ignore what is happening will be hugging the ceiling of the elevator as it falls.

I'm writing a report for one of my sites on marketing in a bad economy - working title is "The Death of Pollyanna"

kay