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Is anyone else feeling pessimistic about where the US economy could be headed? I've been wanting to buy a new house, but am worried about making such a big purchase if things do head further south. Heck, I was even thinking about getting a newer used car, but am afraid to make that purchase as well.

Some companies in the area have already laid off workers, some of my friends have lost their jobs which makes me a little worried for my own job. I work in sales and almost everyone I talk to says how bad things are no matter what part of the country. Anyway, I'm just wondered who else is holding off on big purchases until this blows over?

Brian
 

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Brian,

I certainly share your worries although I try to be optimistic anyway, perhaps hoping to exercise that distinctly American trait under any circumstances. I spend most of the time in California and South Carolina and while California's housing market continues to be full of extremes, even here all areas are being hit by falling values. My last visit to South Carolina brought a lot of surprises. Even folks looking to sell their stunning vacation homes right on the beach have taken them off the market because no one is buying. Not even foreign investors as they feel prices have a ways to go down before they'll purchase.

All of my business colleagues are seeing the same things you are. All industries in all areas (with the exceptions out here of solar and biotech) are either cutting back or laying off people. Where I work we were lucky to have sold a bunch of low-performing assets several years ago and run things lean and quick but even now we're seeing a sharp decline in business from our long-time clients.

But to your question, yes, I'm holding off on purchasing anything bigger than the four new tires I just put on my '99 car. I'd thought about getting something newer (I also like buying "newer used" as replacements -- let someone else have the joy of new car depreciation!) but I'm holding my cash close as possible until I see some fundamental changes to our faltering economy.

Until the dollar stabilizes, the federal deficits are better managed and this contraction/correction/recession is over, I'm going to be content with what I have. It will turn around, the big question being when.

Cordially,
Adrian Quay
 

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Public Education is usually the last sector hit by financial constraints and even at my job, there will be NO overtime this year, no after school programs and supplies are going to be limited if there at all. I'm lucky enough to have scored an interview with a very well paying tutoring company for the academic year and may end up making more this year than by simply working afterschool programs in my school.

My wife and I did look at upsizing to a larger apartment in our complex, but the timing needed to be perfect, so we weren't able to pull the trigger. I'm not what you'd call an "investor" however, and the unit would have been a great place to live and worth the extra $30k. If I were looking to flip it and make a quick buck I would not have even thought about it, but we weren't.
 

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I'm still shopping, but not for major purchases. After the election, things should clear up a bit, and I think we'll be on a healthier plane by spring.
 

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The economy is like heaven compare after the taxes the Democrats pursuaded Bush 1 to sign. And, of course, the Jimmy Carter taxes were worse. The last two years of Jimmy Carter were terrible, so many people getting layed off and few people getting hired. I never want to see the falling economy that Jimmy Carter created.

Howard, people buy cheaper stuff. So, cheap store do good in a bad economy. Instead of buying a motor home or trailer people buy tents. So, camping and mountaineering stores do great. But, if you are making or selling motor homes or trailers- good luck.
 

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Not necessarily, Wal-Mart and Target are loosing a lot of money to narrowing profit margins brought on by higher shipping and food costs, as well as the increase of labour costs in China. However, luxury-brand companies are steading surfing -- some even dancing on the crest, like Ralph Lauren. You cant generalize. Obviously, those hit hardest will spend more time researching a purchase -- looking for the best deal. The majority of the middle class will cut out on discretionary spending: house cleaners, dry cleaning, eating out often, garden services, and that club charge will be used with a little more caution :cool:.
 

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Not necessarily, Wal-Mart and Target are loosing a lot of money to narrowing profit margins brought on by higher shipping and food costs, as well as the increase of labour costs in China. However, luxury-brand companies are steading surfing -- some even dancing on the crest, like Ralph Lauren. You cant generalize. Obviously, those hit hardest will spend more time researching a purchase -- looking for the best deal. The majority of the middle class will cut out on discretionary spending: house cleaners, dry cleaning, eating out often, garden services, and that club charge will be used with a little more caution :cool:.
> The luxury market loses its luster
 

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It can be twisted however you like sir ... I research the economy for a living; and i didn't say all luxury brands are riding high. Your quote is one of my favorites.
If luxury brands are defined by the art market well then we are all in trouble, Southerbys and Christies are saying there sales are down on the past 12 months and unfortunately the way the globe is linked every nation across the board is taking a hit economically at present.

In Canberra the real estate marking is slowing, I heard that on the weekend there were a large number of homes passed in at auction, and this is a market that has had annual growth of over 10% for the past five years. But they are also saying the the Oz housing market is overvalued by 30% for me it could be good as we are holding our breath before we take the mortgage on again, at this rate we are thinking the middle of next year.

But then there are and some people talking of a least a 12 month down turn globally, at present here in Oz we are still riding the Chinese minerals boom so we are protected for the moment, but the Oz$ is heading south at a rate of knots against the US$. And unemployment is on the rise along with inflation so one has to ask where will it end? Are we witnessing the beginning of a recession or is this the beginning of a slow decline into the big global Depression which some prognosticators are predicting, but then it depends on who you listen to, doesn't it.

In November when the first ripples of discontent appeared we got out of our shares fund even then we lost a couple of k in less than a week and since then have just left in the bank where it currently earning a healthy 8%.
 

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It can be twisted however you like sir ... I research the economy for a living; and i didn't say all luxury brands are riding high. Your quote is one of my favorites.
Neither argumentation nor criticisim. Attempted augmentation. Didn't imply you said so, Suh. No good deed goes unpunished....
 
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