How Does a Recession Hurt ME?

[crisi]

More depression information -

People were saving money, but savings were often wiped out between the stock market crash and bank failures. The FDIC was put in place to keep people from having their savings wiped out because of the depression. Just because we HAVE the FDIC, the government can't stay out of this potential recession - which is anticipated to hit the financial services industry particularly hard. Managing to keep banks from failing short term will "move the pain" to a later point, but might manage to keep the federal government in better shape than doing nothing other than what they've already committed to.

Although lots of people kept gardens and farmed, drought covered much of the country, making it difficult to live off the land in much of the Midwest. Can't live off your garden when their is no water and the soil is blowing away in the dustbowl. My Great Grandparents lived on a farm in Minnesota - East enough of the worst of the dust bowl conditions to continue to farm, but times were very tough - and they had a ton of relations who had farms further West move in - in addition to their own twelve children they had as many as four other families on the farm to feed during the depression.

 

[dvcgirl]

More depression information -

People were saving money, but savings were often wiped out between the stock market crash and bank failures. The FDIC was put in place to keep people from having their savings wiped out because of the depression. Just because we HAVE the FDIC, the government can't stay out of this potential recession - which is anticipated to hit the financial services industry particularly hard. Managing to keep banks from failing short term will "move the pain" to a later point, but might manage to keep the federal government in better shape than doing nothing other than what they've already committed to.

Although lots of people kept gardens and farmed, drought covered much of the country, making it difficult to live off the land in much of the Midwest. Can't live off your garden when their is no water and the soil is blowing away in the dustbowl. My Great Grandparents lived on a farm in Minnesota - East enough of the worst of the dust bowl conditions to continue to farm, but times were very tough - and they had a ton of relations who had farms further West move in - in addition to their own twelve children they had as many as four other families on the farm to feed during the depression.

Yes, and others have pointed out that FDIC insurance doesn't mean that you got paid immediately. As I understand it, they can take their sweet time in paying you back.

I agree, financial sector and of course housing will be hit particularly hard. If jobs start to slip, then a lot of businesses will begin to suffer and this will be a much deeper recession that the one we experienced in 2001.

I was talking to the owner of the local wine shop just yesterday. He said that business is slowest it has been in five years for January. He's really hurting. I see more and more "For Lease" signs going up in the shops in my town's main street. Each night my street is usually filled with patron's cars who are eating at the restaurant around the corner. Other than Friday and Saturday night there have been no cars parked on our street.

And yet we went to Border's Books last weekend and it looked like it was December 22nd....packed. So it's tough to completely gauge what's happening thus far.

 

[scottygirl]

Be glad if you don't live in Michigan. We have a beautiful state with wonderful people, but times are tough here. DH is waiting to hear this week if he has a job. He is in banking, not automotive. Thankfully we have savings and house we can afford with an old fashioned fixed rate mortgage!!

 

[HenDuck]

Yesterday, I went to Long's Drug store to pick up a couple of things off their sale ad.

First, I really scrutinized the ad and looked in my pantry and debated about whether I really NEEDED certain items. Then I made my list. Then I cut things off my list. I planned to get 4 items which were very good deals, plus I had a couple of coupons.

Off I went to Long's. There shelves were EMPTY of sale items. People were acting like they'd never be able to buy Ritz Crackers or Spam again. I asked the manager for a rain check for an item. She said they had more stock in the stock room but they were very short handed and didn't have enough clerks to refill the shelves. There were 3 people behind me also looking for rain checks too. I only ended up with 2 out of the 4 things on my list.

So this illustrated two things to me. 1. People are really feeling the pinch since grocery prices are rising. So much so that when there is a decent sale, people go nuts. 2. Businesses are cutting way back on their employees. Services will start to suffer.

Personally, with the grocery prices rising on everything, and our household plan to cut back on the grocery bill, I have been spending very little on food and household items. We're eating out of the pantry and freezer for the next two weeks, except for bread, milk, etc. I'm going to buy a couple of gallons of vinegar and clean my whole house with it. And we've already said adios to soda and bottled water.

DH and I also had a money talk last week. My job this week to submit a proposed budget with more areas to cut/reduce, etc. Buhbye land line!

 

[LKHomemail]

Hold on to as much of your money as you can and yes you should try to buy something for cash or with low mortgage. most all homeowners are losing equity. those that need or want to sell are very motivated so they will take much less money to make a deal. also , the new condos / houses built are not being sold like they anticipated , therefore, they are available cheaper at auctions for 1/2 of what they were intended for. builders can often afford bigger losses than a family will take on their residence. cash will make you king in this . negotiate hard and look around a lot. know what you are offering / buying. good luck.

 

[eliza61]

Unfortunately all that may make sense logically but when you go to the supermarket and a flipping bottle of milk cost you $5.00 bucks you feel the pain. Politicians want to get re-elected but it's hard when you've got the entire country screaming because the cost of living.
Our lovely Govenor of NJ is raising the toll on most roads by 50% next year, that means all the trucks that bring food and essentials to the stores will raise their rates, now the cost of food goes up, once again...

 

[eliza61]

Be glad if you don't live in Michigan. We have a beautiful state with wonderful people, but times are tough here. DH is waiting to hear this week if he has a job. He is in banking, not automotive. Thankfully we have savings and house we can afford with an old fashioned fixed rate mortgage!!

Scotty girl,
Michigan is in my prayers every day. I have a good friend who is a lawyer in that state. I don't care what folks say about having no sympathy when people lose their houses, I've seen what happens when entire neighborhoods go into foreclosure and it's heartbreaking. No where is that more evident than Michigan

 

[dvcgirl]

Unfortunately all that may make sense logically but when you go to the supermarket and a flipping bottle of milk cost you $5.00 bucks you feel the pain. Politicians want to get re-elected but it's hard when you've got the entire country screaming because the cost of living.
Our lovely Govenor of NJ is raising the toll on most roads by 50% next year, that means all the trucks that bring food and essentials to the stores will raise their rates, now the cost of food goes up, once again...

I agree with you, I really do, but how does NJ, any other state, or the Federal Government attempt to balance their budgets if they don't raise revenues? It's expensive to live in most parts of NJ, for sure, and everyone is always screaming about property taxes and such. If the state mandates property tax cuts, the problem gets worse. As it is, many states are seeing big declines in revenue due to the increase in foreclosures.

New Jersey (and many other states) also have a huge deficit in their state-workers pension funds. While we have a 2 billion gap in the budget, about 30 billion in debt, the estimate is that the pension fund is 56 billion under water. Where is *that* supposed to come from?

 

[scottygirl]

Scotty girl,
Michigan is in my prayers every day. I have a good friend who is a lawyer in that state. I don't care what folks say about having no sympathy when people lose their houses, I've seen what happens when entire neighborhoods go into foreclosure and it's heartbreaking. No where is that more evident than Michigan

Thank you for your support. Luckily my DH has made it through the cuts this week, although one of his boses (not direct line) that he admired very much was let go. We live in a neighborhood that appears to be in pretty good shape. I only know of one foreclosure. We have always been very fiscally prudent and will continue to live that way.

 

[mpls_mm]

I don't get worried until I start reading through these threads
I haven't worked for a set salary in a long time, I get nervous getting the same thing. I can get the cold sweats thinking about a fixed number. I am in sales and now have my own business now. I have weathered some bad times, but I just don't see much difference. Bad salespeople quit and then there are fewer of us, so it seems to stay steady. Businesses get nervous and cut back on advertising lowering sales, I plan to increase. I keep taking classes and learning more so I can make my business better, I hope it stays steady. I have been doing some career and marketing consulting for free to build my references and help people find a better way. I am also hoping some trade shows we couldn't get in because of a wait list will have openings and then we will get a spot. I still get a little worried, but I just depend that the tighter the economy gets, the greater the need for a salesperson. I do noticed than when it gets tight, I get a lot more applicants to pick from and more skills are offered. But I do hear from all kinds of people in different parts of the country and I hear horror stories.

 

[englishteacha]

We're seeing some effects here in rural Maine. The school where I teach has a frozen budget...I wonder what we'll do when we run out of paper?? It's a very low income area to begin with, and I have students who honestly can't afford school supplies.

I've noticed a lot of coupons and specials for area restaurants/take out places. It seems like everywhere really needs to drum up business. I know DH and I have reduced our eating out and take out. But when we do go out, we're taking advantage of the specials and coupons.

My DH owns his own IT/web developing business. While he's doing OK, some of his clients are not spending as much on IT as they used to. Luckily, DH has taken on a couple small local businesses in addition to his bigger clients which helps our income.

 

[kinntj]

We're not feeling it, but we have cut out eating out and I cook at home much more. We're eating out of the freezer and pantry this week and part of the following week. In April, we're looking to buy a used car instead of new. This is the first time venturing down this road, so it's a little scarey.

My FIL just called this morning and asked to borrow $2k+ for taxes. They inherited DH's grandma's house when she passed and now since they can't sell or rent it out, they have to pay taxes on it. They can't come up with the money, so they are asking us for it. It's now become part of our problem. His parents were never good with money, so that's why I get so mad when it comes to them and money.
We live in Michigan, so we can't see an end yet to the major problems this state is in. We are so forunate and I thank God every day for DH having his job, because he's been laid off in the past and we know the stress that comes along with it.

I'm in school, so we'll see what job I can get when I get my degree and take my test to be licensed.

I think any money that can be saved right now is a good thing. If our family starts to squeeze now, then it won't be so bad if we really need to during this year or next. We have a trip to WDW in May, but that's the only vacation we have planned this year. We probably will stay in state next year to do long weekend vacations.

 

[MrMarv]

It would be really nice if the government would stay out of the way and let the market & economy 'work itself out'.

I also feel that the upcoming recession will be much worse because, as others have stated, too many consumers have been using their homes as ATM machines, and lots of their financial problems are self-inflicted.

When the government does throw itself into the marketplace and picks winners and losers (the ongoing ethanol hoax/fiasco/disaster/con job being the most recent example), everybody loses.