Economic Downturn - Effects on DL?

[kiwitravel]

Here in NZ there has been a lot of publicity over the uncertainty over the US economy, some US experts are predicting a downturn of Depression proportions. I was wondering what affect this might have on DL, could we see DCA plans put on hold, falling visitor numbers, hotels closing, staff cuts, reduced operating hours???

 

[bradk]

i think, surprisingly enough, disney is weathering it well. at least in orlando. haven't heard anything negative about disneyland either.

a lot of major shop chains are going south though, including the disney store.

it's going to get much worse though, no doubt about that.

 

[ballarinamom]

I think the Disney Store downturn has more to do with the Children's Place taking over the stores and not the economy. They just don't have anything good anymore. DD took in a bunch of money and walked out only spending $15 because she didn't like anything.

I think Disney will actual see a strong continuence as Flying over seas or to the caribbean is too expensive due to flight costs. We live in San Antonio Texas which sees a lot of driving tourists. We have seen no downslide. People still want to travel. They are just more conservative about their plans.

 

[lulubelle]

Yes, we are in a recession here in So Cal. The biggest factors are the mortgage/housing disaster which affects those in construction and banking, loans & real estate. Also I read furniture stores are closing (Levitz and Wickes - two biggies). Gas at $3.75 per gallon. People aren't buying new cars. I think in general people don't have as much to spend and those with money are being conservative. I would guess the only changes at the parks would be slightly lower attendance and maybe better travel deals to entice more visitors. But that's about it. As a visitor to the Anaheim area, it would be business as usual for you .

 

[bradk]

yes.. and starbucks is closing like 100 stores (although they still have plans to add more).. and sharper image is closing half theirs as they claimed bankrupcty and are currently not honoring their gift cards... pacsun is closing a bunch of theirs.. lillian vernon filed for bankruptcy... compusa also basically shut its doors before being bailed out and having only a fraction remain open.. zale closed 5% of its stores.. etc

not all for bad product.

the economy is affected as a whole. all of those people who were sold homes they couldn't afford aren't exactly in the best economic shape.

 

[kiwitravel]

yes.. and starbucks is closing like 100 stores (although they still have plans to add more).. and sharper image is closing half theirs as they claimed bankrupcty and are currently not honoring their gift cards... pacsun is closing a bunch of theirs.. lillian vernon filed for bankruptcy... compusa also basically shut its doors before being bailed out and having only a fraction remain open.. zale closed 5% of its stores.. etc

Wow.... It's one thing to see it on the news and internet but must be another for you that have to live in it. We have already seen the US vs Kiwi dollar shift over 20% but some are predicting a devaluation of over 90%, 15% inflation, bank collapses etc....

Hence the reason for my question, mid last year we were happily planning a DL vacation in 2009 but in such a short time haven't things changed over there.

Don't know what affect we will face here.... But next month we sign a free trade agreement with China, the first country in the world to do so. As an agricultural country who has the best growing climate in the world I suppose we are going to be lucky (you can't shift that to China!!!), I think apart from a slightly raised inflation, money tightening and a falling property and share market, we will probably be OK.

Gerald Celente was here last year and predicted all this in March last year and told NZ business leaders "don't worry about being the cheapest, be the best" and to this end NZ has invested 500 Million in improve our agriculture quality including organic and GE free...

Scary times to be sure

 

[bradk]

http://en.wikipedia.org/wiki/Bear_Stearns

between thursday and friday, their stock lost 85% of its value. it's currently trading at a little more than $4 per share and they agreed to be bought out for $2 a share.

14,000 employees and i'm guessing not every single one of them is keeping their job at the end of the day.

so much for the 'low' unemployment rate (it's so not, but it's been worse within the past 8 years)

if that's not depression in every sense of the word, I don't know what is.

 

[kiwitravel]

so much for the 'low' unemployment rate (it's so not, but it's been worse within the past 8 years)

if that's not depression in every sense of the word, I don't know what is.

From what I can gather the unemployment is still to come, 10 - 20% unemployment predicted, some saying 20% is being optimistic....

Its really scary stuff, maybe they should put the economic forecasts into the HM or may be ToT might be more appropriate, whats been happening is somewhat more in keeping with the Twilight Zone...

But back to the real question, how is all this going to impact on the Disney Corporation?? Does Disney own the DLs in Japan and Paris? Are they milking their money off shore into those parks as we speak?

 

[bradk]

actually, disney does not own the resort in tokyo. everything is licensed to the oriental land company who opted not to sell their interest in the park to disney.

disney does own every other international resort tho, namely paris and hong kong (and the eventual shanghai)

 

[kiwitravel]

actually, disney does not own the resort in tokyo. everything is licensed to the oriental land company who opted not to sell their interest in the park to disney.

disney does own every other international resort tho, namely paris and hong kong (and the eventual shanghai)

There is also talk of a new park to be built in Sydney Australia, don't know if that one will be under license or owned by Disney. Might be a good time for them to diversify off shore...

 

[bumbershoot]

I dunno...I'm rather naive and unsophisticated when it comes to financial matters, and I take it to "what it does to MY life".

DH's father was older, and was a kid during the Depression. From the info gleaned from FIL, the average joe's life wasn't necessarily changed THAT much. Farmers who had loans from the govt, yes. Wealthy people who had stocks etc, yes. But middle of the road folk, not hugely, according to the person we knew who was there (living in Oakland CA at the time). FIL's family would have been fine, had his father not drank and gambled the family's life savings away (and one is led to think that only happens nowadays!).

I tell ya, I've never been more glad for DH and my credit issues from our 20s, which taught us to be wary of loans they give to people who can't REALLY afford loans! Our families were hitting us HARD to buy a home with one of those junky loans, just b/c they are of the mindset that owning a house is everything...but we resisted just as hard back. And both sides of the family have now lost homes...and they had GOOD, proper loans... They just made really bad choices with their finances after getting those good loans...

I see quite a lot of those store problems as being logical conclusions. The CompUSA near us had been shut, but not closed, for a couple years! It's only recently that a sign went up that it's gone. I don't know what they've been doing for those years of paying the rent on that place...

Starbucks just went nuts there for awhile. I believe I read that Schultz is coming back and his re-arrival goes along with their slowing down. Whew! Too dang many coffee places, too many Starbucks, they were becoming a parody of themselves. Thank goodness they did that re-training, b/c their lattes were getting naaaasty. But I thought they were just slowing down opening of stores, not closing ones they already have open...but I could be wrong.

Sharper Image was just a sad shadow of what it was in the 80s, in my opinion. You could get cooler technology at your local Target, and for cheaper, nowadays. And this, coming from a person who wanted nothing better than a huge shopping spree through their stores, back a couple decades ago...

But that's just one naive person's perspective of how it's impacting people.

 

[bradk]

twice is coincidence. three times is conspicuous. four times is a conspiracy.

when all these companies are having financial problems at once, i wouldn't be so quick to blame factors that could only affect them individually. stores close all the time, it's the nature of the beast. but to close most of them at once and file bankruptcy? to have a 66% foreclosure rate due to subprime mortgages? you may not be in financial jeopardy. you may never be, but that doesn't mean the economy as a whole isn't suffering. you can rest easy at night knowing the top 1% aren't worried about financial security tomorrow.

and forget the rising price of oil, you know what's barely begun to hit?
http://www.chicagotribune.com/news/nationworld/chi-costly-wheatmar15,1,5077758.story

and back on starbucks, now that you mention it, it appears that the 3 hour training closure was probably a pr stunt/ploy. when you google starbucks closing stores, you have to look awfully hard to find the news about the stores that weren't closing just temporarily. and the hundreds of people they were letting go (in addition to the stores)


but here you go
http://machinist.salon.com/blog/2008/02/26/starbucks_closing
http://seattletimes.nwsource.com/html/businesstechnology/2004193840_webstarbucks.html

one comment on the great depression by andy rooney

There were pictures of bread lines and soup kitchens in the paper every day when I was a kid. Big bakeries gave away their bread when it was three or four days old and people who were out of work and hungry, lined up to get it. We don't have anything like that now.

he followed it up by saying his father pulled in $8K-$12K a year so they were well off enough and didn't really suffer through it. but it doesn't sound like it was a picnic for many. not to mention, this time around (not to suggest it'll get there), there won't be any bread.

 

[Silly Little Pixie]

My perspective is that things will continue to get worse. I live in Southern California, and the property value/foreclosure problem will be effecting everyone. The rapid decline in values makes people nervous- even if they have good loans themselves. It's hard to see so many empty houses in nice neighborhoods. Gas prices are so high that even I (who rarely notice my gas costs) have seriously cut back on my driving. I am a teacher, and if the Governor's budget cuts go through, approximately 100,000 teachers will be laid off. City and state governments have either announced layoffs or will have hiring freezes. So if you lose your job, good luck finding another. It's scary times, folks. Even if the Feds don't want you to believe it, California is in a recession with a capital R.

That said- I remember Disneyland well after 9/11. It took a long time for the tourists to come back. It was downright empty for a long while. I recall going on Halloween in 2001 and on some rides we were quite literally the only people in line. Back then, people didn't feel safe making long trip/vacation plans. Now- I wonder if they will feel comfortable shelling out for a quite expensive trip West, rather than do more simple vacations closer to home when money becomes an issue. Does that make sense? I do think the average DL visitor shifted in the last 7 years to more % APs and less % tourists. Will people continue to buy APs when they are worried about money? Probably not in the same numbers they are buying now. But frankly, DLR could do with a few more tourists and less APs. It seems like everyone and their brother has an AP. Besides, the APs are not the value they once were.

However- for travelers outside the US, I would think it's a great time to come to the US with the weak dollar!

 

[JenDisneylandlver]

Well I can't speak for anyone else, but we are feeling it! Between the gas prices, the grocery prices, and our gas/electric bill, we are definitely feeling it! This year we are paying at least $100 more a month in groceries then last year. Our gas/electric bill is a good $50 more a month. I can't even tell you how much in gas for the cars. Yikes!

Everything trickles down to everyone else eventually.

 

[Albort]

i think, surprisingly enough, disney is weathering it well. at least in orlando. haven't heard anything negative about disneyland either.

I disagree actually, Disneyland on off days seems a lot less people. Being in a sales environment, i can tell you, its not as high as it used to be. Everything has gone down since since last summer.

 

[kiwitravel]

Well I can't speak for anyone else, but we are feeling it! Between the gas prices, the grocery prices, and our gas/electric bill, we are definitely feeling it! This year we are paying at least $100 more a month in groceries then last year. Our gas/electric bill is a good $50 more a month. I can't even tell you how much in gas for the cars. Yikes!

Everything trickles down to everyone else eventually.

We have had the fuel increases here in NZ and that is really hurting when you take the car out, but power and food has not gone up dramatically, this is understandable here in NZ as food doesn't have to travel far and most of our power is hydro electric.

Bradk thanks for the really interesting links, I just hope all americans are as abreast of whats happening over there...

 

[Flea]

We have had the fuel increases here in NZ and that is really hurting when you take the car out, but power and food has not gone up dramatically, this is understandable here in NZ as food doesn't have to travel far and most of our power is hydro electric.

Bradk thanks for the really interesting links, I just hope all americans are as abreast of whats happening over there...

Where in NZ are you Kiwi??

Just wondering as we've noticed a huge jump in prices of things such as fruit/veges even the local grown stuff. We aren't a huge consumer of packaged foods so we haven't noticed it there (apart from all dairy products - $15/kg of cheese and $5 per block of butter )

Our power has had 4+ increases in the last year and we are now paying what we would normally pay in winter with all heating going in summer. I'm scared to think what winter will be like this year.

We also try not to use our car as it's far to expensive. We try to stay local now.

We make our savings where possible as the more we pay for cost of living the more it takes from our disney fund

I'll be reading this thread with interest

 

[kiwitravel]

Where in NZ are you Kiwi??
Just wondering as we've noticed a huge jump in prices of things such as fruit/veges even the local grown stuff. We aren't a huge consumer of packaged foods so we haven't noticed it there (apart from all dairy products - $15/kg of cheese and $5 per block of butter )

Our power has had 4+ increases in the last year and we are now paying what we would normally pay in winter with all heating going in summer. I'm scared to think what winter will be like this year.

We're are just out of Auckland, we are with Mercury and have only had one increase in power in the last 12 months. We haven't noticed much of an increase in fruit and vege, according to the government CPI figures food has only gone up 1.5% over the last quarter, utilities including power 0.9%.

http://www.stats.govt.nz/products-a...index/consumers-price-index-dec07qtr-hotp.htm

I don't know where you are but up here butter is $3.50 and 500g of cheese is $6.

We have had low inflation for so long we have no concept of what the Americans are facing, for the same quarter they are looking at figures of closer to 4% which must really bite. USA inflation figures exclude energy, transportation and food and are still 3.5%. Estimates put USA 's true inflation is running at around 10% at the moment.

 

[Flea]

We're are just out of Auckland, we are with Mercury and have only had one increase in power in the last 12 months. We haven't noticed much of an increase in fruit and vege, according to the government CPI figures food has only gone up 1.5% over the last quarter, utilities including power 0.9%.

http://www.stats.govt.nz/products-a...index/consumers-price-index-dec07qtr-hotp.htm

I don't know where you are but up here butter is $3.50 and 500g of cheese is $6.

We have had low inflation for so long we have no concept of what the Americans are facing, for the same quarter they are looking at figures of closer to 4% which must really bite. USA inflation figures exclude energy, transportation and food and are still 3.5%. Estimates put USA 's true inflation is running at around 10% at the moment.

Auckland here Sorry if it sounded like I was passing judgement - I was just interested. Hmmm maybe I need to find out where you shop so I can get me some butter, we've moved to margarine as it's cheaper

 

[Flea]

Auckland here Sorry if it sounded like I was passing judgement - I was just interested. Hmmm maybe I need to find out where you shop so I can get me some butter, we've moved to margarine as it's cheaper

Just watched the news and you are right we really don't have any concept of what is going on.