|I have not considered the number of panhandlers increasing, in my tracking of the economy, because there could be similar numbers simply moving to new locations as laws restrict this activity in many communities. (Picture: www.successsystemsnow.com )|
True economists have quasi-scientific ways of tracking economic progress or deterioration. They quote a variety of indexes and place them on graphs. Governments furthur squeeze and massage such data by allowing or disallowing other data which can produce an inaccurate picture. For example, the US government stops counting those who have been looking for work unsuccessfully for longer than two years or so, thus making the final unemployment figures they release periodically artificially low.
I have my own ways of tracking the economy for our family. Although these are scientific based on anecdotal information, they do have some value, especially regionally. I have been tracking mine for thirty years.
My first indicator that the economy is doing well are consignment shops and second hand shops in wealthy areas. In a good economy wealthy people donate or consign really excellent quality goods, and they wind up in abundance in second hand shops at very low prices. In a good economy there is less competition for these than you might think. People are working, vacationing, and not foraging for goods. These are the times when you can find a half krugerrand in a jewellry junk basket for twenty dollars, or a 14 karat genuine gold rope chain for thirty. No one evaluated the coin or the necklace because the load of consigned goods was so large, and it just kept on coming. The first indicator that the economy is slowing is seeing top flight items of this kind disappear from consignment shops or become very expensive. Of course, this is a sample taken from multiple stores in two cities which are about a days drive from our farm.
A second indicator of a deterioration of the economy in the US, are nursing jobs. Clinical nursing is a demanding and difficult profession. Many nurses, particularly those who are raising families work periodically for agencies. When their families income decreases, they return to work for months, or years as the case may be. They might do contract work in month, three month or several month intervals. In a good economy, tons of agencies are looking for experienced registered nurses for short term assignments. In a deteriorating economy, such positions dry up. In the economy of the last three years, newly licensed registered nurses or those without experience might not be able to find new full-time jobs at all.
The last couple of years in the US have brought some economic indicators I have never seen in my lifetime. In ordinary times in our area, many middle class families donate to a couple of the church run foodbanks in our area. We all understand and accept that in life, difficult things may happen and that this safety net can be of great benefit to families whose mother or father may have died, or whose child has a serious illness and for whom a period of financial adjustment will be necessary. Our own family used to buy extra packaged of canned salmon, chicken, tuna or canned fruits from Sam's Club to local food banks. Our son Daniel used to love being part of this regular donation. In good times, families can be helped until members of the church or county welfare officials can help the family to their feet again. Most of the time, after transient family emergencies, the family who had received help could regain their place in the community as gainfully employed. Often, they would have an understanding of how valuable the food bank system is. In the past few years, several more area churches have developed food banks in order to meet a growing need. Many families who made one hundred and sixty thousand dollars or more per year, have lost both of their jobs. They quickly move through their savings, and are depending upon a foodbank. They remain here eating from the food bank, until their home is repossessed, at which time they leave the area. This economic time is different from others in that a larger number of people who were doing well, are finding themselves using food banking services. The change has been so significant that county businesses have all been collecting canned goods for all of our church or agency run food banks because the demand is so high that many times during the week, they are down to nothing on the shelves.
The third indicator, one of the newest ways I have found in the last couple of years of tracking economic downturn, are the number of astoundingly good real estate buys which can sometimes be found on Ebay. I am not advocating buying something without checking and doing ones due diligence, but there are times when a house in urban America can be had for no more than one dollar. I am not saying that this is a wise buy. If it costs you a dollar to acquire it, and the taxes are two thousand dollars a year, and the entire street is scheduled for demolition at your expense, and there is no police or fire service there, then you probably haven't make a good purchase. Nonetheless in a lot of urban places, Detroit included, dollar homes exist.
Ebay and similar internet sites were the first real estate indicators that the economy was deteriorating in a major way. In my fairly expensive county, it took much longer to see that deterioration come to suburban and rural middle class homes. We were somewhat insulated here, but the signs of economic deterioration eventually came. The fourth indicator includes local real estate. It took several years to see repossessions in number, but they eventually came. At first, the houses sat empty as the banks who repossessed them waited for the economy to improve. When the economy didn't improve, after a year or more of holding these homes in their portfolios, one by one they came up for sale at far below their tax assessed values. At first, they were just below their county assessed values. Now, very few people have the money to acquire and repair these homes which have been sitting vacant in all weathers without heat for often two to three years. Now, they are markedly below their county assessed values. Our daughter bought and restored one of these homes. Of course, she is being challenged by the payments she must make to keep her home, as her own salary has decreased the result of increased American income taxes.
The fifth indicator of economic deterioration can be seen on Craigslist. On Craigslist, many people who were able to pay bills and acquire goods and animals in the last few years have found the need to sell up, downsize, part with things that could be expensive to move, in anticipation of leaving the area and becoming more capable of moving wherever the jobs might be. In the last year episodically everything from fairly new expensive furniture, to vehicles, appliances, are available for a fraction of the actual cost and value because people are selling up, and getting out. One of the largest tragedies and indicators that the economy continues to deteriorate is the availability of all types of animals for very little money. Horses, purebred dogs, livestock and poultry all episodically sell for very little money.
From my vantage point, a long term deterioration of the economy has come which is deepening rather than abating. Although my indicators are not scientific, they do spot trends, and the trends are not good. I am bringing this to your attention because your own indicators for your own region might be similar to mine. They might track similar or additional factors in your area. You might track how many Goodwill stores or second hand shops open and how many other businesses have closed. You might track how many people you know in your county's major employer have lost jobs, or how many remain unemployed. You might track how many of your friends are newly receiving foodstamps. I should probably track the number of people who graduated from the university with my kids who did also and have been unable to find a job that they did not already have before university graduation. (Many have kept their part time Subway restaurant jobs but unable to find jobs in their fields, or any fulltime job at all.)
The point is that in order to make good financial choices for your own family, that governmentally organized or squeezed figures might not be of value. You might need to identify your own economic indicators for your own region. You should also pay attention to the economic health of your employer. Given these conditions, it would probably be wise to have family members working for different employers so that in the event of a plant closure, you weren't all out of work at the same time.
Please let me know if you identify any other observations of economic indicators that have relevance here.