The Economic Recovery Fantasy

Back in the Day….

When I was a small boy selling greeting cards and flower seeds door to door, both my paternal and maternal grandparents, all of my aunts and uncles – all 12 of them – worked in the textile mills in Aiken County, South Carolina. Sadly, both sets of grandparents and all but one uncle and aunt are gone along with the jobs in the mills. Once vibrant mills now stand as skeletons, with broken windows, in yards overgrown with weeds.

Thank you JFK and Bill Clinton for eliminating an industry that used to produce 95% of all of the clothing we wore.

The textile industry along with the tele-marketing, service sector, customer service and health care industries eliminated and outsourced to Asia. Millions of job have been eliminated and with them an entire middle class has all but disappeared.

Yet to hear the Feds tell it we are on the way to economic recovery. What a joke.

The way they tell it, the economy is now recovering from a recession – thanks to their decisive action. But the facts don’t support the recovery fantasy.

Homeowners, for example, are still getting killed. More than 28% of them are now underwater. According to Bloomberg: More than 28 percent of US homeowners owed more than their properties were worth in the first quarter as values fell the most since 2008, Zillow Inc. said today.

Homeowners with negative equity increased from 22 percent a year earlier as home prices slumped 8.2 percent over the past 12 months, the Seattle-based company said. About 27 percent of homes with mortgages were “underwater” in the fourth quarter, according to Zillow, which runs a website with property-value estimates and real-estate listings.

Home prices fell 3 percent in the first quarter and will drop as much as 9 percent this year as foreclosures spread and unemployment remains high, Zillow Chief Economist Stan Humphries said. Prices won’t find a floor until 2012, he said.

The number of homes with negative equity rose to 16.2 million in the first quarter from 13.1 million a year earlier, Zillow said.

Nothing is ever what it seems. Bad news is never as bad as it seems and good news is never as rosy as projected. What is real is that our economy is in a quagmire and is not going to recover anytime soon. And before it is over millions more will be out of work and of hundreds of thousands of businesses will exit through the bankruptcy door.

There is no solution to this except to sharpen your sales skills and make more money. For us that is possible. For most that is not.

On a recent sales training consulting day, a new client asked what was the single biggest sales training piece of advice I could give him. Without hesitation, I told him that he only had limited time to build his business and that if he were smart he would work his ass off as if there were no tomorrow.

Speed, I told him, was the great equalizer and opportunity attractor. In today’s economy, the slow get eaten up or run over.

Since I drink my own Kool-Aid, I confess that I am working relentlessly to amass as much wealth as fast as I can before the next shoe drops and this economy goes into the tank. Don’t know when that will be or what will precipitate it, but it will come and it will be harder to sell and extract money going forward than it is today. You can take that to the bank.

As always I appreciate and read all of your comments. Please leave a comment and let me know your thoughts.

Chris Busch

Steve,

I remember the same issues surrounding the steel industry in Pittsburgh where I grew up. Everyone talked about the comeback that never came. The foolish people actually waited for it. It took almost 30 years for the city to recover and while it is doing relatively well today, it’s a smaller city than it was in the early 70’s.

Those who did best accepted the hard facts and made a plan to change industries and careers and executed that plan.

Kate Smalley

I do not believe we are in an economic recovery. In fact, I believe it will be at least eight years before we see any change, and I know this is not a popular outlook to have. While it may feel good to talk positive, it does not change the reality of our situation and the fact that there are people out there losing jobs daily and many families who are losing their health insurance benefits, homes, businesses, etc. These are, in my mind, not the signs of economic recovery.

Yes, we have to work harder than ever today to achieve success, and we each measure success differently. For me, success is being able to continue to pay for our family’s health insurance and put food on the table while my husband is out of work. For others, it might be more extravagant. I am very fortunate that I am able to achieve success in this regard, and I work hard daily to ensure that I can continue through the down times that we all are facing in this economy. Yes, I am working harder than I ever have.

And while at the beginning of my comment I did say that I did not believe that we are in an economic recovery right now, it doesn’t mean that I am letting that mindset bog me down. Quite the contrary, I believe that this is the time we must be vigilant and aware of our surroundings and pay attention to new opportunities and technologies that might be the bridge to increased sales, as well as to new obstacles as they present themselves. At all costs, it is my opinion that we must remain observant and open to possibilities more than we ever have before.

I think of RIM and how Blackberry so dominated the marketplace a few years ago, as an example. Could they ever have imagined how, when it first appeared in the market, Android might affect their business? And as we see new mobile devices today shaping the way we do business and pay for services, are we aware of how this will affect our own business in the future and even how people will view our websites? Could it be that the desktop and laptop computer might fall to the wayside and most internet access might happen via smart phone or tablet? And, if so, how must we change our web pages today to best facilitate the use of our online content?

We must continue to work harder and smarter to ensure our success, with an eye always to the future and an ear open to our customers’ needs at all times.

I wish you continued success in your venture. Thank you for the excellent article.

Kate

Steve Clark

Kate,

Thanks for your thoughtful comments. I applaud your efforts to do whatever it takes to take care of your family.

Steve Clark

Chris,

Sticking ones head in the sand does not make the problem go away. We have a lot of things yet to come that will make earning money more difficult. Only those willing to embrace the truth and deal with it will survive.

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