Looking for what companies to invest in during this economy?
What we’re buying — and not buying — says a lot about how consumers are feeling these days.
It also says a lot about the American economy, considering that consumer spending accounts for 70 percent of all U.S. economic activity. Every time we go out to lunch, buy a new sweater or pick up a DVD, we’re contributing to the retail sector, the biggest sector in the economy.
This week, companies from Home Depot to Target to Saks reported results for their latest quarters. Some were strong, some were weak. All tell tales of the consumer: thrifty, staying close to home, and focusing on basics.
Here’s a look at what people are and aren’t buying.
HOME – WHAT WE’RE BUYING: People are buying more garden products and paint, especially in areas with high foreclosure rates like California, according to Home Depot. CEO Frank Blake told investors that as homes are sold as part of the foreclosure process, that spurs sales of paint and carpet upgrades, since owners want to improve their new homes.
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WHAT WE’RE NOT: Home Depot said consumers continued to limit their purchases of bigger items like appliances.
For more, read the article. Some things seem obvious. Some things aren’t.
I’m trying to avoid buying products made by American corporations, since they all seem to outsource our jobs to India and China anyway. Why give money to betraying middlemen? I can buy direct from China in many cases. For food, I’d like to buy local from small farms but that is harder to do.
If a car company lowers its rates, it stimulates their sales. If government lowers cars’ prices, it transfers spending from one sector to the auto sector.
I am not buying anything in retail stores in California since Arnie raised the sales tax 20%. Instead, I am buying it, if needed, mail order or from Amazon. No tax, low or no shipping.
And, of course, I am buying things that will be unavailable later, possibly. You know, things like band aids.
#1, For food, I’d like to buy local from small farms but that is harder to do.
It’s getting very hard. If a small gardener sells you food, he risks bringing down the wrath of the FDA.
I buy what I need not what I want. I am paying off what is left of my credit card and going strictly pay as you go.
I may have some cash burning a hole in my pocket around the summer of 2011 assuming I don’t get laid off.
We tried growing our own tomatoes, this year. But the weather has been lousy in my neighborhood. And the things were slow to bloom and ripen. But in the next county, my uncle has more than he can eat. So it works out.
Good news is that some store chains are offering their own “generic brands” of items, at lower prices than the major brands. Which have been gouging us far too long. We found that Weis brand pre-cooked bacon, was a better deal than Hormel’s. And far less wasteful than the uncooked stuff. So now we buy the store brand microwavable bacon (it doesn’t shrivel up or get tough).
The cola vendors keep playing this stupid game of hiding the cost. It’s always 3/$10 or 4/$11. Rather than simply posting the single six pack price. I rarely buy the stuff, if it’s more than 4/$10 ($2.50 a pack). Their latest excuse for raising cost, will be this trial switch from using HFCS, to sugar. After we’re use to the higher cost, they’ll sneak the HFCS (or nutrasweat) back in. One can always drink fruit juice or Shasta.
If, as they claim, americans aren’t buying new major appliances. Then they’ll try getting the ones they have fixed, before buying new ones. Which will lead to more jobs for local labor. Though the replacement parts may still come from abroad (shame on you Maytag). The problem is that the banks don’t like loaning money to american small businesses. So american repairmen and shops, will find it tough to get started and survive. But recent immigrates could fulfill this market niche. Because they often finance their own kind, when the banks won’t, under the table. They have been taking over the convenience stores, dry cleaners and liquor stores. So appliance repair might be next thing the foreigners monopolize.
You should give up drinking soda. It is almost as bad for you as smoking. Just not as disgusting. -signed an ex-smoker and budding nutritionist