Nothing to Celebrate
Courtesy of Michael Panzner at Financial Armageddon
To borrow from the title of a recent New York Times op-ed by U.S. Treasury Secretary Timothy Geithner:
"Welcome to the Recovery!"
(Image: Source)
"Wary U.S. Employers Keep Hiring Plans on Hold" (Reuters)
LEXINGTON, Kentucky – Anyone puzzled by the reluctance of U.S. companies to hire workers in the midst of what looks like a business-led recovery needs to talk to Robert Harvell.
With more than 30 years in the excavator-making business and six recessions under his belt, Harvell, the chief executive of LBX Company, thought he knew what to expect when he saw signs in late 2006 that another downturn was coming.
He was wrong. So now, like a lot of manufacturing executives surprised by the downturn’s speed and severity, he is being extra cautious, especially when it comes to expanding his pared-down payroll.
Signs of how wary U.S. employers are to hire again are expected with Friday’s release of payroll figures for July.
Like Harvell, many executives worry the current recovery will prove as unpredictable as the recession that preceded it.
"I am embarrassed to say that we anticipated a softer landing and a speedier recovery than what we’ve seen," he told Reuters this week. "But then everything began to implode."
"Another Indicator Showing the Health of the US Economy Comes Up Short" (PR-USA.net)
The latest results of statistics obtained from the Commercial Collection Agency Association in the first quarter of 2010; has reported lower numbers.
Members of the association reported a 23% decline in the total dollar amount of commercial claims placed for collection in comparison to the same period in 2009. As a member of the CCAA; Credit Decisions International, Ltd. (Elk Grove Village, IL) participates in the survey along with other prominent agencies throughout the country.
While many would expect collection agencies to be booming in difficult economic times, this is not usually the case. As the recession has dragged on, fewer companies are extending credit and banks are not lending money to the business community to the extent prior to 2008. As a result, there are less companies with receivables on their books to collect or companies with the lines of credit to borrow against to pay what they owe.
In a another comparison, the CCAA reported that the collectability of accounts placed for collection with the association’s membership hit a level of 21% in the second quarter of 2010, which is up from just 5% as reported in the previous quarter.
Emil Hartleb of the CCAA said, “These figures reflect the general condition of the US economy which is experiencing a slow recovery from the recession that began in 2008. While wholesale sales and other commercial transactions are improving, they are not improving at a rapid rate. Some economists are concerned that we might be facing a so-called “double dip” recession.”
"Food Stamp Use Hit Record 40.8m in May" (Bloomberg News)
WASHINGTON — The number of Americans who are receiving food stamps rose to a record 40.8 million in May as the jobless rate hovered near a 27-year high, the government reported yesterday.
Recipients of Supplemental Nutrition Assistance Program subsidies for food purchases jumped 19 percent from a year earlier and increased 0.9 percent from April, the US Department of Agriculture said in a statement on its website.
Participation has set records for 18 straight months.
"Tight-Fisted Consumers" (Associated Press)
July retail sales lackluster, especially at higher end
NEW YORK – Worried about the stalling economic recovery, Americans remained reluctant to spend at stores in July, especially on pricier items such as jewelry, though they let go of some money for travel, according to data released Wednesday.
Revenue from high-end jewelry, which had held steady in June, plummeted in July from a year earlier, when the figures already were dismal. Furniture also suffered as the boost from homebuyer tax credits wore off. Shoppers even pulled back on shoes and children’s clothing, while luxury spending – excluding baubles – virtually was unchanged.
The figures from MasterCard Advisors’ SpendingPulse, which include transactions in all forms including cash, signal that spending remains choppy as shoppers grapple with an almost 10 percent unemployment rate and tight credit.
"Tough Times? Sell Fido" (Real Time Economics)
We are what we search. In economically stressed times, we search online for ways to make ends meet.
Back in January, analysts at BNY ConvergEx Group scanned the results of economic queries given by the “autocompletes” in the search engine Google. (Autocompletes are the suggested finishes to whatever you start typing into the search line. The engine’s algorithms adjust the autocompletes to whatever is currently the most popular completion to the phrase you are entering. Type in “Justin” and “Bieber” pops up.)
The January results of five phrases showed a very bearish view of the world. For instance, the phrase “I want to sell my” was autocompleted with “car” and “house.” The word “Filing” was finished with “bankruptcy.”
The group repeated the exercise in August, adding Yahoo and Bing. The hope was that attitudes had improved. No such luck. If anything, searchers seem more desperate for cash.
“I want to sell my” is now finished with “hair” and “laptop.” Google also suggested “dog” as a possible sales item.
Bankruptcy is no longer the most popular autocompletion for “Filing.” But that’s only because it was nudged out by “for unemployment.”
"One in Five American Families with Kids Are Food Insecure" (The Daily Tell)
Inconsistent Access to Food Attributed to Worsening Economy
New York City – Twenty-one percent of American households with children are “food insecure” – a situation that adversely affects children most – causing poor cognitive development, socio-emotional and health outcomes – according to a new report by the National Center for Children in Poverty (NCCP), a think tank at Columbia University’s Mailman School of Public Health.
Food insecurity is a term used by the U.S. Food and Drug Administration to describe the situation when the food intake of one or more members of a household is reduced and eating patterns are disrupted because the household lacks money and other resources for food.
NCCP reports that the incidence of food insecurity has markedly increased in recent years, due largely to the worsening economy. “Households with children appear to be more at risk today of experiencing food insecurity than they were a decade ago,” says Vanessa R. Wight, PhD, the lead author of the NCCP report, “Examining Food Insecurity Among Children in the United States.”
"NPD: Consumers Spending More, But Shopping Later for BTS" (Drug Store News)
PORT WASHINGTON, N.Y. — The NPD Group found that 38% of consumers polled in its back-to-school spending intentions survey plan to spend less this year, compared with 44% of respondents a year ago.
Consumers are continuing to put off shopping until the last minute. Half the number of consumers this year (3%) compared with last year (6%) said they have purchased for back-to-school already, NPD reported.
“More and more consumers keep telling us that they are putting off their shopping later and later each year,” said Marshal Cohen, chief industry analyst, The NPD Group. “I would say that this is change in the timing of consumption, more people ‘buying now and wearing now,’ is part of the lingering impact of the recession.”
