February 27, 2009 — Watching the evening news, it sometimes appears as though the recession continues to spiral downward toward a mini-depression, if not worse.
Store closures.
Massive layoffs.
Stocks indexes dropping to levels not seen in over a decade.
Bankruptcies.
Reductions in services.
Nonexistent availability of credit.
Continuing high rates of foreclosures and dropping home prices.
We live in an area that has seemed almost recession proof in all of the economic downturns since we moved here in 1980. Yet, even here, there are empty stores as well as layoffs, foreclosures and higher unemployment. On the other hand, there are new homes being built, businesses that are adding on or building new, and a few help wanted signs.
Most of the people we know, both here and elsewhere, are weathering the storm fairly well, though not all. Quite a few people, including two of my brothers-in-law will have to postpone retirement because of losses in their savings and a nephew employed by Circuit City has lost his job.
So far, we have not been impacted, though we have changed some of our spending habits. In these trying times, it seems better to be frugal and conserve what we have — just in case.
How are things in your area? Have you made adjustments because of the economy?
Store Closing photo from flickr, by dpicker, 
creative commons licensing
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Mike, being a retired GM hourly employee after 34.5 years, the wife and I are very nervous about losing ALOT of my monthly pension as I'm not old enough to apply for Social Security yet, (2 more years). Not to mention the possibility of losing our medical insurance too.
We are trying to be very frugal in our purchases, using coupons and sales as much as possible.
I know several folks that have lost as much as 75% of their retirement 401k account value because they didn't pay enough attention to their investments.
How many others like them are there?? Just think about it.
We are making adjustments too. I talked with someone today who believes it's very possible we would enter a decade-long depression.
We've lost a lot of our savings, of course, but so far it hasn't affected our daily life.
<abbr>Jean Browman–Cheerful Monk’s last blog post..Going On an Artist’s Date</abbr>
Mike, India is having its share of grief and growth has slowed down. Let me reproduce below an extract from:
Foreign Policy Research Institute
Over 50 Years of Ideas in Service to Our Nation
"India, which was even later than China to plug back into the
global grid following its failed experiment with socialism,
is now enjoying some of the benefits this relative
insulation has conferred in the current crisis.
Additionally–and uncharacteristically for Asian economies–
it has a relatively highly developed service economy, which
lessens its economy's weighting toward manufactured exports.
Due to these and other factors, India appears positioned to
withstand the financial turbulence in 2009 with its growth
momentum reasonably intact. Having registered approximately
8 percent growth in 2008, it appears on track to achieve
close to 6 percent growth in 2009."
There are sectors that have been retrenching work force and that is causing some problem. Inflation having come down, consumption has gone up and that supports some economic activity in some new parts. On balance, and from a macro point of view, I think that things will not be bad.
At the micro level, my agency, which is dependent on sales to export oriented units, has not had any business the last month. It is not expected to generate any income for me till April. We too have had to cut back on some of the indulgences like avacado pears, artichokes, etc, but otherwise things are not too bad.
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Bob – My personal opinion is that pensions should be protected above all else. If GM is getting aid from the government, pension protection should be part of it.
One of the saddest things about this economic downturn is the number of people whose retirement savings have been wiped out. Where would they have been if one of the schemes to privatize social security had been implemented 6 or 8 years ago? That would have made things even worse than it is already.
Vered – I am certainly hoping that this will not turn into a real depression. If it does, there are many of who are doing okay now that may not be in the long haul.
Jean – I'm sorry to hear that. I hope things improve.
Ramana – It's interesting to hear that India has not been impacted as much as many other places. Hopefully, for you (and everyone else in India), that will continue to be true.
Hi Mike – We've been cutting back for sometime now and are so used to it, it's become second nature. We drive less, don't eat out much, shop for bargains, and reuse that which we can. I keep thinking back to earlier generations and what they had to do to survive the depression. I think we can learn a lot from them as they certainly didn't waste much, were thankful for all they had and didn't seem to need material goods to make them happy.
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Barbara – We're getting used to it, too, though we have been as frugal as we needed for a long time to be able to put enough into savings for me to be able to retire at 55. However, we are planning to do some traveling this year.
My hubby has his own car sales / service business and it can be touch and go. He is managing to keep it together but working a lot more hours. We're hanging on. Skipping vacations – who need 'em anyway when you have lots to explore in your own town. Watching the supermarket sales. Not buying new clothes, except for The Child, but at discount places. Definitely sticking to necessities in general.
<abbr>Jannie Funster’s last blog post..So there!</abbr>
Jannie – I hope things pick up soon so that you can do better than "hang on." I think a lot of people will continue to be frugal for quite some time after things do pick up.
We are adjusting. Hubby has his own computer repair business so things are not too bad. It's a little tough, because we are helping my daughter through a difficult time.
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Rose – It's good that you're able to adjust when so many people just don't have any margin left.
I've always been frugal so it's getting harder to cut anything especially since prices keep going up. I haven't been directly impacted yet but my ex was laid off from a university and that is causing a decrease in child support and my daughter lost her health insurance. I've been scrambling to earn extra to make up the difference. It's been ok so far but sometimes I wish I could just relax without feeling guilty about it.
I lean toward pessimism so I am inclined to think that things are going to continue to get much worse.
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Kim – With a reduction in child support from your ex, it sounds like you've been directly impacted to me.
I'm generally an optimist, but I think things will get somewhat worse for many folks before it gets better.