So much to say....

....so little time. I am apparently too busy to keep up with the President and Congress: which is precisely what they are counting on. Their plan is dependent on the public being so wrapped up in their daily lives, so busy, that they do not have time to pay attention to what is going on in Washington.
Lets start with the economy: I was sent these two links (In the tank forever and Obama's spending spree ) last week. Both of them are interviews with "Retail maven Howard Davidowitz", who is apparently an expert on retail trade and the economy (I must be showing my ignorance by not knowing who he is). He paints a pretty gloomy picture, and he has some great points, but lets look at each one:

In the Tank Forever - First of all, I think his analysis of the retail business is pretty much right on. There is no way in this environment that the volume of retailers can be maintained. There are way to many "Big Box" stores at the malls, too many specialty shops and neighborhood strip centers have been seriously overbuilt. All with a declining disposable income among consumers. We have been asking for years how all of the new shopping centers they were building in our area could be supported, and it turns out they can't be. Most of them are sitting close to empty.
What really struck me though was something else that he touched on. There are two primary causes that will lead to a collapse of many retailers: 1) the significant increase in unemployment and 2) the decrease in available credit. Both of these have significantly contributed to less spending in the retail sector; people are only buying what they need, not what they want and nothing frivolous. That all makes perfect sense. What bugged me about his comments was this: not only did he include available credit as "income" but he seemed appalled by what I considered to be pretty good news; people are starting to save money. His stats were that the consumer has gone from spending 6% more than they make (credit use and debt) to actually saving 7%.
A couple of things that come to mind based Davidowitz's comments. The first is that it is telling that our economy has been growing for years based on irresponsible spending and the misuse of credit. If you look at most of the industries that are in big trouble now, they are mostly dependent on, or providers of, credit: auto, retail, mortgage, banks. It is all fake, a manufactured economy with no basis on anything tangible. [The exception, of course is the mortgage industry; that disaster is the result of lending too much money to people that could not afford it on properties that were not worth it. A subject for another time and already well covered elsewhere.]There have been analyst and economist telling us for years that the over use of credit was going to cause problems some day. It looks that that day is today.
The other thing that occurred to me was something else I recall hearing, from some source I have forgotten, years ago: as a country we have gotten away from a production based economy. We do not produce anything. Industry has been forced overseas and our illusory economic growth has been the result of consumers buying products made in China, Taiwan, India and Mexico and paid for with money they have not actually earned yet.
Is it possible we have too much retail? Too many service based companies? It used to be that a community would grow up around the local factory and supporting businesses (retail, restaurants, doctors, etc) would open to provide for the factory workers. I understand that the nature of our economy has changed: there are not as many factory jobs, there is more automation, etc. But, should it not be a clear sign to the politicians that it is time to do away with burdensome tax policy that forces business to send their production facilities overseas in order to complete. Should we reward companies for employing Americans instead of punishing them for being profitable?
I know retail is a big part of our economy, and I know that more people will lose their jobs if that market segment continues to decline. But i just do not see how it is sustainable in it's current form. And Davidowitz did say that there are going to be some companies that come out of this just fine, possibly even stronger. It is not all bad, it just has to change.
Can that happen with our current government? That is a HUGE concern that I will cover next time. That is enough for one entry.