Tag: recession

10 things we can’t live without

10 things we can't live without

The harrowing recession began in 2007 overturned the American priorities, with frugality now considered a virtue for the first time in decades. Despite recent uptick in spending, retail sales remain lower than they were three years ago. Sales of homes, cars and appliances have plunged. Shoppers have cut the toilet paper and cigarettes, once thought recession proof. Although sales are down porn. Thrift, it seems, has no borders.

However, the Americans clung to a few expensive necessities surprising, reflecting changes in American society that go far beyond pennies. Food, clothing and housing have long been staples most obvious. But the data he has finally roll into the wind as the recession shows that we also need a little entertainment and a tasty beverage or two. The company is more important than ever – even if it is not the man. And you can not even find a job these days if you do not have Internet access. As we redefine what is really important, here are 10 new key U.S.

1. Laptops (Portable computers)

IPAD could be the latest must-have gadget, but the computer power transcends trendiness. Brianna Karp, for example, has discovered a lot of homeless people in line, saving many through their own laptop, as she. Shipments of phones have skyrocketed over the last three years, with sales in 2010 may be twice what they were in 2007, according to the Consumer Electronics Association. Part of the jump comes from netbooks but cheap laptops of all sizes are more pervasive than we socialize, communicate, shop, get our new and increasingly live our lives online. sales office, meanwhile, have been on a steady decline, stability, mobility assets.

2. High-speed internet

Many people have reduced cable television, telephone service, and even gas and electricity use. But once you have access to high speed Internet, you do not go back. In a poll by the Pew Research Center last year, high speed Internet was one of three things that people said was a necessity in 2009 than in 2006. Appliances such as microwaves, dryer and dishwasher, however, are considered less important in 2009 than they had. And the data of the Telecommunications Industry Association shows that the rapid increase in the number of broadband Internet subscribers hardly slowed in 2008 or 2009. In 2013, more than 90 percent of all Internet connections in the United States will be high speed.

Global sales of mobile phones fell for the first time in 2009. But sales of smart phones – which can handle email, browse the Internet and do a variety of other things – increased 7 percent, according to TIA. And sales could jump 25 percent this year, as people who have been putting off upgrades mobile finally NAB iPhone or Blackberry of their dreams. As laptops, smart phones have become a lifeline for multitasking harassed we pretend that we are not.

4. Education

As Kevin and Deanna Daum were spiral into bankruptcy in 2009, they decided they could live without their two cars, their two homes, and most of the subtleties. But they insisted on keeping tuition of their son, then an elderly person in a private secondary school. Many Americans seem to feel the same.

Although the data does not readily show how much families spend on education, many families say they have given up other things to protect their children’s education, whether in school or a private school, tutoring, enrichment programs or activities related to school. private school enrollment has decreased by less than one percent of 2008-2010, and university enrollments have increased over the past two years. This is partly because jobs are scarce, but also because Americans value education at all. “It’s an investment that pays very well,” said Sandy Baum, an economist at the College Board. “People are willing to borrow for it and they know it is shortsighted to abandon.”

5. Television

Amercian spend less on entertainment – but watching more television. A recent study by Deloitte has found that typical American watches worth nearly 18 hours of shows on TV at home every week, two hours longer than last year. One reason could be that people are more unemployed kill time at home. But television can also be seen as a cheap alternative to sports events, concerts and buying DVDs. And hard core viewers can not be all that short, since sales of HDTVs have increased steadily throughout the recession.

6. Movies

Ticket sales dipped in 2008 but rebounded in 2009, reaching a peak in five years. One major reason was Avatar and other films in 3-D, which accounted for 11 per cent of the fund to take in 2009, up 2 percent the previous year. Any increase in box office is a victory for the cinema, which until last year had been losing viewers for home theater systems and a growing range of films on cable and the Internet. 

7. Music downloads

The need for mobility applies to music, too. CD sales fell 21 percent in 2009, but downloading entire albums and singles grew almost as much. The Pew study comparing luxury and needs helps explain why, more people considered an iPod a necessity in 2009 than in 2006 despite the recession.

8. Pets

Fido is sitting at the table these days. Maybe even the head of the table. While Americans have cut back spending on themselves, spending on pet food, supplies, grooming, veterinary care and clothing (clothing?) Has been the continuing rise of around 5 percent year. Industry representatives attribute this to the “humanization” of pets, which has led many pet owners to close the “quality of life gap” between their animals and themselves. The iWoof can not be far behind.

9. Booze

Smoking does not make us less than fully virtuous. The Americans fell alcohol upscale, but we are drinking enough to compensate for cheap stuff, which is the usual trend during recessions. Beer and wine have increased slightly during the same in recent years. With a bar and restaurant sales down, which suggests more people are drinking at home – while they watch television, no doubt.

10. Coffee

The Americans have followed the advice of pennies, and then returned to the stud of $ 5 per day. But they make up most infused their own coffee. About 56 percent of American adults drink coffee, a proportion that has not changed in recent years. But a recent survey by the National Coffee Association found that 86 percent of coffee drinkers have their own home, up from 82 percent a year earlier. And those who drink coffee at another place (think Starbucks) fell from 31 percent in 2009 to 26 percent in 2010. Of course, if people are drinking more alcohol at home, then it is logical that they themselves be more doses of coffee, too. If the economy improves, perhaps we need less of each.

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Are you living the American Dream?

Are you living the American Dream?

The answer depends a lot on your income, according to a new survey.

Despite the “official” end of the recession over a year ago, life remains dull for much of the population: Nearly half the U.S. population does not live what they call the “dream U.S. “according to a new survey published this week.

StrategyOne, part of Daniel J. Edelman PR firm, surveyed 1,008 Americans and found 48% of respondents answered “no” when asked: “Are you living the American dream today?”

In households earning between $ 40,000 and $ 50,000 per year, only 41% responded affirmatively to the question. However, for households earning more than – those at or above $ 75,000 per year – 71% of respondents said they lived the American dream. This supports the idea that money might not be everything, but it helps.

The survey also suggests a lack of faith in the possibility of upward mobility: the 48% who said they do not live the American dream, more than half said they did not think they ever would.

Define the American dream, of course, will vary from person to person. Although stereotyped as one might think of the suburban house, the fence, a family, a sensitive dog and cars, which could be a long way from your own goals and reality. That said, the results strengthen the argument that from an economic standpoint, the locals are mixed in their views, regardless of what the academics argue.

Not surprisingly, official unemployment rate of nearly 10% – and worse by wider measures – and the collapse in housing prices has created considerable uncertainty. However, pockets of hope has been found. “Despite the doubts that were wondering if people have reached or will reach the American dream, 74% believe that the ideal of achieving the American dream and be able to” do in America is largely true and possible, rather than being just a myth. Sixty-eight percent of those households earning less than $ 25,000 per year also share this belief, “according StrategyOne.

The survey revealed that 81% of respondents strongly or somewhat (most were in this camp) “believe that if you work hard and playing” a middle-class life in the U.S. is available, 74 % say success is more a function of hard work, rather than good fortune.

So what’s the takeaway? The American dream is not dead yet, but it’s hard to maintain interest for many of us. Maybe we just need him to, and we find that it is still very much alive, that a different form. Let us know what you think.

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U.S. downgrade and your credit cards

U.S. downgrade and your credit cards

Interest rates on cards are likely to be affected much differently than those on consumer loans.

Stocks have kept investors on edge during the past week as the Dow swings from boom to bust. For consumers, it’s a good time to step away from the market mayhem to survey the damage and potential threats to their finances.

One area that is getting short shrift — but shouldn’t — is the impact the Standard & Poor’s debt downgrade may have on credit card rates.

First, some background. The downgrade on U.S. Treasury bonds that was issued by ratings agency Standard & Poor’s — from AAA to AA+ — was widely viewed as a wake-up call to the U.S government and its “drunken sailor” approach to spending (though that might actually be an insult to drunken sailors).

While the Fed says it will keep rates near zero, many economists expect major consumer interest rate categories to eventually rise because of the downgrade, including things like mortgage, auto and student rate loans.

It’s no big secret why. Any consumer with a low credit rating knows that he or she is a bigger credit risk to lenders, and thus must pay higher interest rates for creditors to accept that risk and loan the consumer money.

It’s the same thing with Standard & Poor’s and the U.S. government. A lower credit rating means that global creditors face a higher risk of default when lending money to Uncle Sam. To borrow money — usually through the sale of U.S. Treasuries in the bond market — the U.S. government will have to offer higher rates of return to investors.

But here’s an interesting point. Even if Treasury yields do recover and grow again, your credit card’s interest rates may not follow the script. Why? Let’s look at three reasons:

Credit card rates aren’t tied to Treasury rates. Instead, credit card interest rates are tied to the Federal Reserve’s prime interest rate, which still remains historically low, and should continue along that path. Federal Reserve chairman Ben Bernanke has made it clear the Fed’s rate policy is to keep those rates down, despite what S&P says. That should help keep card rates manageable for consumers.

The CARD Act has a built-in safety net. Government can do something right once in a while. Take the credit card legislation passed in 2009: Inside the CARD Act is a provision that limits how much card issuers can raise rates. The reforms are limited to “current account balances,” meaning card companies can still raise rates on new charges, so be careful of new spending going into the last four-and-a-half months of 2011. But any charges you’ve already made are tied to current rates, which still remain relatively stable. A quick glance at BankingMyWay’s credit card rate search tool shows card interest rates stable between 11% and 20%, with the average credit card rate around 14%.

Standard & Poor’s doesn’t speak for everyone. Right now, S&P is out on its own with its debt downgrade. The other major U.S. credit agencies — Moody’s and Fitch ratings — didn’t go along. And until, or even if they ever do, don’t expect your credit card interest rates to rise significantly.

So call it a cloud with a silver lining. Yes, the stock market is taking a huge hit, but at least your credit card rate isn’t.

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20-somethings create their own jobs

20-somethings create their own jobs

In today’s economy, you can’t just wait around for someone to hire you, say young entrepreneurs.

Five years ago, after graduating from New York University with a film degree and thousands of dollars in student loans, Scott Gerber moved back in with his parents on Staten Island. He then took out more loans to start a new-media and technology company, but he didn’t have a clear market in mind; the company went belly up in 2006.

“It made me feel demoralized and humiliated,” he says. “I wondered if this was really what post-collegiate life was supposed to be like. Did I do something wrong? The answers weren’t apparent to me.”

Still in debt, Mr. Gerber considered his career options. His mother kept encouraging him to get a “real” job, the kind that comes with an office and a boss. But, using the last $700 in his bank account, he decided to start another company instead.

With the new company, called Sizzle It, Mr. Gerber vowed to find a niche, reduce overhead and generally be more frugal. The company, which specializes in short promotional videos, was profitable the first year, he says.

Mr. Gerber, now 27, isn’t a millionaire, but he’s paid off his loans and doesn’t have to live with his parents (he rents an apartment in Hoboken, N.J.). And he thinks his experience can help other young people who face a daunting unemployment rate.

In October, Mr. Gerber started the Young Entrepreneur Council “to create a shift from a résumé-driven society to one where people create their own jobs,” he says. “The jobs are going to come from the entrepreneurial level.”

The council consists of 80-plus business owners across the country, ages 17 to 33. Members include Scott Becker, 23, co-founder of Invite Media, an advertising technology firm recently acquired by a Google unit; Lauren Berger, 26, founder of the Intern Queen, a site that connects college students with internships; Aaron Patzer, the 30-year-old who sold Mint.com to Intuit for $170 million; and Josh Weinstein, 24, who started CollegeOnly.com, a social networking site that is backed by a PayPal founder.

The council, which has applied for nonprofit status, serves as a help desk and mentoring hotline for individual entrepreneurs. People can also submit questions on subjects like marketing, publicity and technology, and each month a group of council members will answer 30 to 40 of them in business publications like The Wall Street Journal and American Express Open Forum, and on dozens of small business Web sites.

Council members assert that young people can start businesses even if they have little or no money or experience. But whether those start-ups last is another matter. Roughly half of all new businesses fail within the first five years, according to federal data. And the entrepreneurial life is notoriously filled with risks, stresses and sacrifices.

But then again, unemployment is 9.8 percent; Mr. Gerber’s in-box is flooded with e-mails from young people who have sent out hundreds of résumés for corporate jobs and come up empty. According to the National Association of Colleges and Employers, only 24.4 percent of 2010 graduates who applied for a job had one waiting for them after graduation (up from 19.7 percent in 2009). What do some people have to lose?

THE lesson may be that entrepreneurship can be a viable career path, not a renegade choice — especially since the promise of “Go to college, get good grades and then get a job,” isn’t working the way it once did. The new reality has forced a whole generation to redefine what a stable job is.

“I’ve seen all these people go to Wall Street, and those were supposed to be the good jobs. Now they are out of work,” says Windsor Hanger, 22, who turned down a marketing position at Bloomingdale’s to work on HerCampus.com, an online magazine. “It’s not a pure dichotomy anymore that entrepreneurship is risky and other jobs are safe, so why not do what I love?”

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How to know when the recession is over

How to know when the recession is over

Many Americans just aren’t feeling the impact of the recovery in their daily lives.

Most economists think the recession technically ended a year or so ago, when the economy started growing again after shrinking for five quarters out of six. But a year’s worth of “recovery” hardly feels like it. Unemployment, at 9.6 percent, is painfully high, and companies show little interest in hiring. That leaves nearly 15 million unemployed Americans wondering what to do next.

Overall, Americans have lost $12 trillion in home equity, investments, and other forms of net worth. We’re ready to rebuild and go back to work, but instead of picking up steam, the economy seems to be stalling, possibly headed for a dreaded double-dip recession. The prolonged malaise could cost Democrats dearly in the upcoming midterm elections.

Healing is underway in badly damaged parts of the economy. But improvements have been too slow and subtle for many Americans to notice. Here are six ways to tell when we’re finally entering a recovery that feels like one:

The unemployed people you know start to find jobs. Unemployment is the single biggest indicator of economic health–or misery. Rising unemployment cuts into incomes and spending and spooks consumers, so it’s hard for housing, retail sales, and other key parts of the economy to recover until jobs come back. So far, they haven’t–but layoffs have largely stopped and temporary hiring is picking up, so we’re part of the way there.

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Jobless claims rise to highest level in 9 months

Jobless claims rise to highest level in 9 months

First-time jobless claims hit 500K, highest level since November as labor market weakens.

Employers appear to be laying off workers again as the economic recovery weakens. The number of people applying for unemployment benefits reached the half-million mark last week for the first time since November.

It was the third straight week that first-time jobless claims rose. The upward trend suggests the private sector may report a net loss of jobs in August for the first time this year.

Initial claims rose by 12,000 last week to 500,000, the Labor Department said Thursday. Construction firms are letting go of more workers as the housing sector slumps and federal stimulus spending on public works projects winds down. State and local governments are also cutting jobs to close large budget gaps.

The layoffs add to growing fears that the economic recovery is slowing and the country could slip back into a recession. “The rise in initial jobless claims over the past three weeks makes it difficult to maintain confidence in the recovery and suggests the labor market is backtracking,” Ryan Sweet, an economist at Moody’s Analytics, wrote in a note to clients.

Stocks tumbled on the fear of more layoffs and weak job growth. The Dow Jones industrial average fell 185 points in midday trading. Broader indexes also declined.

Jobless claims declined steadily last year from a peak of 651,000 in March 2009 as the economy recovered from the worst downturn since the 1930s. They hit a low of 427,000 in July before rising steadily over the past six weeks.

In a healthy economy, jobless claims usually drop below 400,000. “This is obviously a disappointing number that shows ongoing weakness in the job market,” said Robert Dye, senior economist at the PNC Financial Services Group.

Dye said claims showed a similar pattern in the last two recoveries, but eventually began to fall again. The current elevated level of claims is a sign employers are reluctant to hire until the rebound is well under way. That’s what happened in the recoveries following the 1991 and 2001 recessions, which were dubbed “jobless recoveries.”

California reported the largest increase in new claims two weeks ago, the latest data available. The state saw a jump of 4,393 in claims, due to more layoffs in services. Georgia has seen claims rise sharply for two straight weeks because of layoffs in construction and manufacturing.

The nationwide increase suggests the economy is creating even fewer jobs than in the first half of this year, when private employers added an average of about 100,000 jobs per month. That’s barely enough to keep the unemployment rate from rising. The jobless rate has been stuck at 9.5 percent for two months.

Private employers added only 71,000 jobs in July. But that increase was offset by the loss of 202,000 government jobs, including 143,000 temporary census positions.

July marked the third straight month that the private sector hired cautiously. Economists are concerned that the unemployment rate will start rising again because overall economic growth has weakened significantly since the start of the year.

After growing at a 3.7 percent annual rate in the first quarter, the economy’s growth slowed to 2.4 percent in the April-to-June period. Some economists forecast it will drop to as low as 1.5 percent in the second half of this year.

The four-week average, a less volatile measure, rose by 8,000 to 482,500, the highest since December. The number of people continuing to receive benefits fell by 13,000 to 4.5 million, the department said. The continuing claims data lags initial claims by one week.

But that doesn’t include millions of people receiving extended unemployment insurance, paid for by the federal government. About 5.6 million unemployed workers were on the extended unemployment benefit rolls, as of the week ending July 31, the latest data available. That’s an increase of about 300,000 from the previous week.

During the recession, Congress added up to 73 extra weeks of benefits on top of the 26 weeks customarily provided by the states. The number of people on the extended rolls has increased sharply in recent weeks after Congress renewed the extended program last month. It had expired in June.

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