I remember in 2008 hearing some people say ‘I refuse to participate in the recession’. As if they had some control of general economic trends and forces. Oh sure it sounds defiant and strong but it’s also something like whistling through the graveyard.
The Dow Jones lost more than 4% (500 points) on Thursday. July unemployment figures came out and the news is not very good – no surprise. Yet the other night we went out to take our daughter for her birthday dinner (Thursday night) and the first two restaurants we went to in Connecticut were booked solid. They were nice restaurants and not inexpensive. I did not get the feeling that the people were nervous about the economy in general.
Is it that people have become so accustomed to dining out that they do it despite the fact that is expensive and a bit of a luxury? In fact the luxury market appears to be fairly immune to the overall economic downturn although before yesterday the stock market was 80% higher than it was in 2009 at this time.
Is the mounting U.S. national debt finally bringing everything to a head? While I (and people a lot smarter than me) cannot answer that, it does feel as if the U.S. and the world are in for a stretch of bad economic weather that could last a very long time.
If mood has anything to do with it then China has a leg up. The Chinese perceive the troubles of the west are a validation for their style of governance. However I had that same feeling in Hong Kong which is part of China but operates in a much more western environment. And the mood in Hong Kong also was positive and can-do. So I don’t believe the west’s problems are hardly a kind of referendum on socialism, capitalism or any kind of –ism for that matter.
Terms like ‘soft-landings’ and ‘double-dip recessions’ are increasingly tossed around – today in particular. I sincerely hope that in trying so hard to prognosticate the future, the experts are not willing bad things to happen even if inadvertently. When enough people talk about how bad things are and how they are getting worse or will get worse before they get better, the notion becomes so strong that any other outcome might become impossible.
Do you think attitude plays a role or are macro-economic trends and forces too powerful to be impacted by the way people feel?