'The Consumer is Totally Wrecked'

Yes, I'm sure it reflects confirmation bias on my part, but it's hard to ignore Howard Davidowitz's thoughts on the state of the economy given that he has in recent years been correctly pessimistic on prospects for a sustainable recovery.

Here is a brief snippet from a recent Bloomberg Television interview (posted below) with the long-time retail analyst, entitled "Davidowitz Says `Worst to Come' for U.S. Retail Sales: Video":

The consumer is totally wrecked and that's why there's no way this economy's coming back, because the consumer is 70 percent of the U.S. economy....

The consumer is out of money....They have no jobs. We've got 18-and-a-half percent unemployment and underemployment. The consumer's debt is 120 percent of disposable income...The consumer is wrecked.

Comments

[roger]

correction: the wage earner has been ASSASSINATED,
the wage earners are the back bone of this economy.
the wage earners are the producers and the consumers
If you think this distinction is unimportant, think
again.

[Real Deal]

Yes, yes, but so boring already.

Consumers are wrecked because they deserve it. Disagree? How can you? America is a country jam full of white collar fools. Blue collar socialists. And no collar communists.

What about those 1% gold collar guys? They are Ponzi fascists! And they all wrapped themselves up bullshit democracy to screw the other guy. Ha ha!

What about capitalists? There ain't any. Everybody deserve what they are getting - One Big Screw.

[Joe]

Yes, things are indeed over.The fat lady is singing.

[sharonsj]

I am confused by Real Deal's comments. Consumers are wrecked by 30 years of terrible policy decisions by Congress that put corporations first and people last. Because it took so long for things to go bad, most people didn't realize what was happening until we had a perfect storm of burst bubbles, undeclared wars, the incompetent Bushies, and totally crazy politicians.

Any talk about socialism is just a Republican ploy (like abortion and gay marriage) to divert attention away from the real problems. But I agree we are totally screwed.

[roger]

@ sharonsj.
Socialism is a dirty word,especially among the politically
ignorant and the upper polite society.However the reality
is that this crisis is 100% Capitalist made,a carbon copy
of the 30's,only this time it has more finality.

[Rocky]

It may be September 1, but the year is 2010 not 1939 (start of WWII) and Mr. D. is living in the US not Warsaw, Poland. Take a chill pill Mr. D. The consumer is not dead, just being more prudent with his money. We have known for years that the US is over stored and probably over housed. The reported unemployment rate in California is not much worse now than it was around 1982 or 1983, when it topped out at over 11%. Of course, things could get a whole lot worse if the two main political parties continue to bicker and put party politics above the interests of the country. The US $ could follow the old German mark into the toilet. The Republic could fail. We could see book burnings on Park Avenue and concentration camps outside our major cities. God did not put in an appearance at Auschwitz in 1942, so I doubt that he would show up in Brooklyn or Washington DC or even Salt Lake City. Who would have thought in 1913 that things would turn out so badly for Europe's Jews in the following 32 years?

[kevinearick]

Market Spectroscopy / Exiting the Dark Side of the Moon

Oil provides a straightforward analysis of a dc bus. Don’t begin with theory. Look at the price patterns over time, which occur due to participant types orbiting the market, each with its own quantum effect. Technicians, fundamentalists, retail, and market-maker are simplified examples. Over time you will see the market algebraically reduce participation to reveal individual orbital cause and effect over quantum time periods. Currently, for example, you want to begin with an absolute change algorithm to take advantage of volatility, add a base algorithm to reflect the contract market bottom installed by the market-maker, and refine the algorithm into a vortex.

Once your algorithm sees the quantum orbits and the result of their various joint effects, you can identify the transistor triggers for each in the communication system. For a simple example, when a particular analyst recommends particular stocks, under particular circumstances, you may reliably predict the beginning of a retail pump and dump operation, and a little calculus will both maximize your return and minimize losses to the retail investors.

So, if you apply a light with a particular energy, you will get a particular response, and economies are self-adjusting; to the extent a market is artificially wound, it will unwind, with predictable characteristics. The problem here is bringing the market into an equilibrium net orbit with what must be built, rather than allowing reactance to increase the imbalance. The Fed is not entirely blind, but it has no way to direct credit effectively, because it cannot anticipate the electron. Its only way to regulate the system is to close the loop.

The distribution/wave appears quite stable for long periods of time, because the quantum changes among the components balance. Although large external changes appear to be quantum developments, the computer age for instance, they are not. If an economic revolution is required, and it is, the components are already there. The problem is one of a socially imprinted psychology preventing the required perception. The last solution becomes a filter against the next solution, in order to create the perception of stability. That illusion becomes increasingly addictive.

So, you are up 5% this week. How do you take the money off the table? The real question is where to re-direct investment toward the end of more productive outcomes, and work back. Because the dc bus cannot see anything beyond itself, and algebraic reduction pools behaviors in quantum time, it will not see your exit until it's too late.

[xqqme]

No one from the government on either side of the aisle held a gun to anyone's head and told them to live beyond their means.

[roger]

held a gun to anyone's head: of course not!
Culture is a much greater power than the gun,
it regulates human behavior on a grand scale,
rare is the individual who can escape its law.
The hunter gatherer of the past had a different
culture than the agricultural society,but both
cultures where dictated by life necessity's.
Modern society is heavily influenced by finance
and mass advertisements,advertisements in order to be effective caters to every negative desire we humans have, and there is plenty of them. This free will we so prize,is nothing more than a grand illusion.

[francismarion]

If "free will is a grand illusion",
then we are sensate automatons and nothing more;
the universe is truly impoverished.
Can these child-beings resist any blandishment?
The candy store seems less crowded of late;
could it be there is yet hope?

The culture of parsimony is vindicated
by the debt that has not been contracted.
The culture of self-indulgence is changing,
a beneficial correction is in the making.

[Progressive Ed]

We Progressives expected to prevail in the long run, but none of us dreamed that the perfect storm of the massive cratering of the USA/WORLD economy with the election of our guy Barack. Decades of planning and extraordinary effort from the Left has finally born fruit. Incredible!
Howard Davidowitz is right only if you care about the middle and upper middle class. However, the triumph of collectivism/Progressivism will make them no longer possible.
Viva La Raza!!

[Real Deal]

@sharonj

"Consumers are wrecked by 30 years of terrible policy decisions by Congress that put corporations first and people last. ...."

With due respect Sharon, you are one of the 'fools'. Which is why you believe it took 30 years of terrible policy to bust up world biggest economy.

No. It took only a few years and one stupid regime to do it. Do I need to tell you who?

While US of 1980-2000 has committed all kinds of economic sins, the robustness of the industrial economy and skills of the people were such that there was a high net gain.

The real armageddon-league damage took place since 2000. The numbers, the facts, the misdeeds, the arrogence, and the rackets tell the story. I don't need to tell the sorry story here.

In a short 8 years - 2001 bubble creation to 2008 burst - America went insane. Both government and society went insane. Fed by hubris, delusion, greed, low-skill and plain stupidity. The whole world saw it immediately and issued endless warnings, advises, cautions. But America ignore them all - how can 2nd class world be smarter than superepower US is the mindset and attitude.

"Any talk about socialism is just a Republican ploy (like abortion and gay marriage) to divert attention away from the real problems. But I agree we are totally screwed."

What's behind all the noise and nonsense you hear from TV and big media is one root reality. AMERICA HAS BEEN ENGAGED IN AN ALL-OUT SOCIAL CIVIL WAR FOR A LONG TIME. This war is fought in all fronts, and will continue to result in irreconcileable differences. The country will go down until one side destroy the other.